At present, India imports almost 70% of its Li-ion cell requirements from China and Hong Kong, he added citing reports from the Ministry of Mines.
“By 2030, just to meet the local demand for Li-ion batteries, India would need over $10 billion of investment in cell manufacturing capacity, with additional investment in capacity refining raw materials,” he said.
As a result, the report further states that it would create one million or more jobs in battery manufacturing and related ancillary businesses and services.
He said India can learn a lot from China, which has aggressively expanded in electric vehicle batteries over the past 10 years, conquering every part of the supply chain to become the dominant player in electric mobility.
China is now leading in next-generation electric vehicles thanks to strong R&D investment, favorable government policies, foreign direct investment inflows and aggressive acquisition of raw material resources in all geographies, adds The report.
“Taking lessons from India’s northern neighbour, improved access to raw materials can be achieved in a number of ways, including reducing import duties on raw materials, improving bilateral relations with resource-rich countries of raw materials and encouraging Indian companies to acquire these resources,” he said.
The report suggests that a collaborative approach between government and industry is the way forward to build a local supply chain for batteries and make India an export hub.
“Comprehensive government policies that encompass the entire battery value chain – from natural resource acquisition to battery recycling – will go a long way in providing the necessary impetus for the industry,” the report, titled “ E-mobility: Manufacturing cells in India”.
Measures such as tax subsidies and the development of special economic zones/lithium parks in all countries to promote investment in raw material refining and cell manufacturing capacities and the continuation of PLI programs and subsidies for the cell manufacturing will be essential.
Additionally, the report called for regulations for battery use, secondary applications and recycling with strong compliance incentives.
While EV cells are the most critical part of the e-mobility value chain, the Indian EV industry suffers from over-reliance on imports, limited local manufacturing, limited access to raw materials and refining capacities.
“To accelerate the growth of e-mobility in India, the government and industry ecosystem must collaborate, to nurture a local, self-sustaining EV value chain, with established battery manufacturers, OEMs and startups, in investing in continuous R&D, partnerships and global alliances to create a strong supply chain,” said Arthur D Little, India Managing Partner, Barnik Chitran Maitra.