India needs to ramp up battery cell manufacturing to meet EV goals!

India needs to ramp up battery cell manufacturing to meet EV goals!!

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Indian companies are increasingly exploring opportunities to set up battery cell manufacturing operations to meet the demand for components of electric vehicles (EVs). The Indian government is encouraging domestic lithium-ion cell manufacturing that is conducted by NITI Aayog, India would have to manufacture Lithium-ion batteries domestically to meet its EV targets without relying on imports. The government initiated the National Mission on Transformative Mobility in 2019 to encourage phased manufacturing programs for batteries and EV components. The initiative aims to aid in the setting up of an intricate framework of state-of-the-art battery manufacturing units all across India. To support cell manufacturing, the needs a sufficient supply of raw materials mainly, lithium, cobalt, nickel, etc through mining grounds within the country or its peripheral countries. Over the next decade, NITI Aayog proposes to set up mega factories that aggregate up to capacities near 50GWh, with an estimated cost of USD 5 billion. This is expected to reduce India’s dependency on foreign imports thus encouraging the supply of indigenously manufactured batteries.

It said India can learn a lot from china which has aggressively expanded in the EV battery space over the last 10 years, conquering each part of the supply chain to emerge as the dominant player in e-mobility. China now leads in next-generation EVs through large investments in R&D, favorable government policies, foreign direct investment inflows, and aggressive acquisition of raw material resources across geographies. Taking lessons from India’s neighbor in the north, improved access to raw materials can be provided in multiple ways, including reduction of import duties on raw materials, improving bilateral ties with countries rich in natural resources of the raw materials, and encouraging Indian companies to acquire those resources.

“Comprehensive policies from the government that encompass the complete battery value chain from acquisition of natural resources to recycling of batteries will go a long way in providing a necessary push to the industry”, said the report titled E-mobility: Cell manufacturing in India’. Steps such as tax subsidies and the development of special economic lithium parks across countries to promote investments in raw material refining and cell manufacturing capacities and continued PLI schemes and subsidies for cell manufacturing will be key. EV cells are the most critical part of the e-mobility value chain, the Indian EV industry suffers from overdependence on imports, limited local manufacturing, finite access to raw materials, and refining capacities. “To accelerate India’s electric mobility growth, the government and the industry ecosystem must collaborate, to nurture a self–reliant, local EV value chain, with the established battery, manufacturers, OEMs, and startups investing in continuous R&D partnerships and global alliances to create a strong supply chain.

The increasing demand for electric vehicles and the rising shift towards clean energy resources will drive the lithium-ion battery market’s growth in the coming year. An analysis conducted by JMK Research and the Institute for Energy Economics and Financial Analysis (IEEFA) estimated that the Indian lithium battery market would grow from 2.3 GWh in FY2021 to 104 GWh in FY2030, with electric vehicles (EVs) accounting for 90 percent of the total industry. The Indian government has set a 30 percent electric car sales target by 2030. The Central Electricity Authority predicts that India will need 34 GW/136 GWh of battery storage to add 450 GW of renewable resources. This will speed up the country’s move to becoming a significant user of lithium batteries.

According to Mr. Vikrant, COO of EVI Technologies. The technology of lithium batteries is constantly evolving. Until recently, the two dominant chemistries seen in the Indian market were LFP (Lithium Ferro Phosphate) and NMC ( Nickel Manganese Cobalt). In Indian contexts, LFP chemistry is considered safer, but NMC chemistry has a higher energy density.

Solid-state batteries are intrinsically safer because they are non-flammable and much research is being done in this field. In this decade, there will be further advances in lithium battery technology, which can lead to higher adoption.