The country's tax authority is reducing the amount developers can claim in 'accelerated depreciation' from 80% to 15%.
Accelerated depreciation allows businesses to write off investments in developments such as wind projects rapidly, thereby reducing their tax liability.
However, it could have been worse. There were reports earlier this year the incentive would be scrapped altogether.
In January, director of wind policy at the Indian Ministry of New and Renewable Energy said: "Accelerated depreciation will go away in the April."
Launched in the 1990s, accelerated depreciation has been a key factor in the expansion of India's wind sector to more than 14GW of total capacity.
It is hoped developers may turn to India's REC scheme, which has been growing in popularity. September's auction increased by nearly 100% compared to a previous one in July.
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