Indian companies are increasingly exploring opportunities to set up battery cell manufacturing operations to meet the demand for components in electric vehicles (EVs). The Indian government is encouraging domestic lithium-ion cell manufacturing, which is being 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 programmes 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 country needs a sufficient supply of raw materials, mainly lithium, cobalt, nickel, etc, through mining grounds within the country or in its peripheral countries. Over the next decade, NITI Aayog proposes to set up mega factories that aggregate up to capacities near 50 GWh, with an estimated cost of $5 billion. This is expected to reduce India’s dependency on foreign imports, thus encouraging the supply of indigenously manufactured batteries.
Taking lessons from China
It is said that 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, favourable government policies, foreign direct investment inflows, and aggressive acquisition of raw material resources across geographies. Taking lessons from India’s neighbour in the north, improved access to raw materials can be provided in multiple ways, including the reduction of import duties on raw materials, improving bilateral ties with countries rich in the 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.
Need of local EV value chain
EV cells are the most critical part of the e-mobility value chain, and the Indian EV industry suffers from overdependence on imports and limited local manufacturing, finite access to raw materials, and limited 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% of the total industry. The Indian government has set a 30% 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 towards becoming a significant user of lithium batteries. The technology of lithium batteries is constantly evolving. Until recently, the two dominant chemistries seen in the Indian market were Lithium Ferro Phosphate (LFP) and Nickel Manganese Cobalt (NMC). In Indian contexts, LFP chemistry is considered safer, but NMC chemistry has a higher energy density. Li-ion battery technology allows for the highest level of energy density. Performances such as fast charging or temperature operating windows (from -50°C to 125°C) can be fine-tuned by the large choice of cell designs and chemistries. Furthermore, Li-ion batteries display additional advantages such as very low self-discharge and very long lifetime and cycling performances, typically thousands of charging/ discharging cycles. In lithium-sulphur (Li-S) batteries, there are no host structures. During discharge, the lithium anode is consumed and sulphur is transformed into a variety of chemical compounds; during charging, the reverse process takes place.
A Li-S battery uses very light active materials: sulphur in the positive electrode and metallic lithium as the negative electrode. This is why its theoretical energy density is extraordinarily high: four times greater than lithium-ion. Major technology barriers have already been overcome, and the maturity level is progressing very quickly toward full-scale prototypes. For applications requiring long battery life, this technology is expected to reach the market just after solid-state lithium-ion. Solid-state batteries are intrinsically safer because they are nonflammable, and much research is being done in this field. Also, it permits the use of innovative, high-voltage, high-capacity materials, enabling denser, lighter batteries with better shelf lives as a result of reduced self-discharge. Several kinds of all solid-state batteries will likely come to market as technological progress continues. The first will be solid-state batteries with graphite-based anodes, bringing improved energy performance and safety. In time, lighter solid-state battery technologies using a metallic lithium anode should become commercially available. In this decade, there will be further advances in lithium battery technology, which can lead to higher adoption.