Competitiveness of India in the EV Battery Supply Chain

India is witnessing an increase in electric vehicle (EV) adoption fueled by the Indian government’s commitments to climate change and its vision of decarbonizing the transport sector. This would lead to a substantial demand for batteries, which account for 30-40% of the value of an EV. While the Indian government has brought to the fore its focus on EV battery manufacturing through Production-Linked Incentive schemes, India’s domestic EV battery manufacturing remains at its nascent stage.

This study consisted of a review of India’s current EV battery market and relevant industrial policies, and semi-structured interviews with industry experts. Through interviews, the team has identified eight key decision-making factors when companies set up battery manufacturing facilities. The report evaluated the competitiveness of India’s EV battery electrode, cell, and pack manufacturing against the eight decision-making factors. It also highlighted successful industrial policies of other countries in critical mineral sourcing and battery manufacturing development to provide lessons for India. The final recommendations are organized around upstream critical minerals sourcing and midstream EV battery manufacturing. To secure critical minerals, this study recommended India incentivizes LFP and smaller batteries, supports domestic lithium refineries, creates battery recycling infrastructure, and continues to build partnerships. To bolster India’s midstream EV battery manufacturing, this study recommended guaranteed offtake, upfront subsidies, better policy communication, international R&D collaboration, and ESG compliance at this critical juncture in global EV battery manufacturing.