India plans $4.6 billion in incentives for battery makers in electric vehicle push: Report
India plans to retain its import rate of fifty surely sorts of batteries, including batteries for electric vehicles, until 2022, but will increase it to fifteen thereafter to market local manufacturing, the document said.
India invites Chinese participation in its plans to expand Electric Vehicles
The policy may benefit battery makers like South Korea’s LG Chem and Japan’s Panasonic Corp also as automakers which have started building EVs in India like Tata Motors and Mahindra & Mahindra. (File photo: REUTERS/Jorge Silva)
India plans to supply $4.6 billion in incentives to companies fixing advanced battery manufacturing facilities because it seeks to market the utilization of electrical vehicles and hamper its dependence on oil, consistent with a government proposal seen by Reuters.
A proposal drafted by NITI Aayog, a federal think factory chaired by Prime Minister Narendra Modi, said India could slash its oil import bills by the maximum amount as $40 billion by 2030 if electric vehicles were widely adopted.
The proposal is probably going to be reviewed by Modi’s cabinet within the coming weeks, said a senior government official, who wasn’t authorised to discuss the matter and declined to be identified. NITI Aayog and therefore the Indian government didn’t answer requests for comment.
The think factory recommended incentives of $4.6 billion by 2030 for companies manufacturing advanced batteries, starting with cash and infrastructure incentives of 9 billion rupees ($122 million) within the next fiscal year which might then be ratcheted up annually.
“Currently, the battery energy storage industry is at a really nascent stage in India with investors being a touch apprehensive to take a position during a industry ,” the proposal said.
India plans to retain its import rate of fifty surely sorts of batteries, including batteries for electric vehicles, until 2022, but will increase it to fifteen thereafter to market local manufacturing, the document said.
Though keen to scale back its oil dependence and hamper on pollution, India’s efforts to market electric vehicles are stymied by a scarcity of investment in manufacturing and infrastructure like charging stations. Just 3,400 electric cars were sold within the world’s second-most populous nation during the last business year, compared to sales of 1.7 million conventional passenger cars.
The policy may benefit battery makers like South Korea’s LG Chem and Japan’s Panasonic Corp also as automakers which have started building EVs in India like Tata Motors and Mahindra & Mahindra.
While China accounts for 80% of the world’s lithium-ion cell production, India has introduced stricter investment rules for Chinese companies. it’s also bogged down the approval processs for a few proposals after a deadly border clash between the 2 countries in June.
The draft proposal said annual domestic demand for battery storage and market size – currently but 50 gigawatt hours and price just over to $2 billion – could grow to 230 gigawatt hours and quite $14 billion in ten years time.
It didn’t offer an estimate of what percentage electric cars it expected to get on the road by 2030.
The proposal estimates it might cost firms some $6 billion over five years to line up manufacturing facilities with the support of state subsidies.
NITI Aayog has been the driving force of several key India government policies including the planned privatisations of a swathe of state-owned companies.
