Government Urges Battery Manufacturers to Set Up Units in India

The Minister for Power, R.K. Singh, recently chaired a meeting with battery manufacturers in New Delhi to discuss the creation of an ecosystem for incentivizing battery manufacturing in India.

Officials from the Ministry of New and Renewable Energy (MNRE), Indian Space Research Organization (ISRO), Ministry of Electronics and Information Technology (MEITY) and NITI Aayog attended the meeting along with executives from battery and electric vehicle (EV) manufacturing firms.

Singh exhorted the industry to set up battery manufacturing units in India as the future demand is going to be very high owing to the government promoting deployment of EVs across the country in a big way.

“Tenders for procuring EVs have already been issued and we have started procuring the vehicles. This is going to increase”, Singh said.

Asserting that the future bids will be for solar-wind hybrid coupled with storage, Singh said that the government will soon come out with a policy in this regard and its focus will be on ‘Make in India’ campaign in this sector.

On the issue of adequate supply of raw materials for battery manufacturing, Singh said that the government has already initiated interaction with resource-rich countries such as Bolivia.

The industry representatives also raised the issue of high Goods and Services Tax (GST) rates on batteries with the government. They demanded that in order to promote Make in India, preference should be given to made in India batteries for government procurement. They also stressed upon the need for creating Indian standards for batteries and setting up of field testing facilities for both stationary and mobile sectors.

Emphasizing on the need for creating a manufacturing base for batteries in the country, Singh asked the Department of Space and ISRO to share relevant technologies with the industry. Highlighting the need to start manufacturing of cells in India, the industry representatives requested for a favorable fiscal regime. They also expressed the need to create an enabling environment for recycling of batteries in India.

Singh assured the battery manufacturers that the government would take all possible measures to incentivize battery manufacturing in India.

If this translates into action at a fast pace, it will be beneficial for the entire EV sector of the country. Singh’s meeting with the relevant stakeholders also demonstrates that the government has adopted a proactive approach for the EV sector and is not only setting targets, but also trying to develop each stratum of the EV industry before there’s a boom in demand.

If battery manufacturing is developed and aided now when the demand is low, and the sector is in a relatively nascent stage, it will prove to be beneficial for the industry in the long run. For any EV, the battery comprises a major share of the cost and therefore, if the batteries are indigenously produced, the costs will plummet, making EVs more popular among the masses. As of now, the government is pushing the EV demand by procuring EVs for its various departments and the demand from the common man is still low.

As reported previously by Mercom, India is targeting the deployment of five to seven million electric vehicles in the country by the year 2020 under the National Electric Mobility Mission Plan (NEMMP) 2020.

However, in February 2018, Mercom had reported that the government is unlikely to announce pan-India policy framework for EV industry. So far, the states of Maharashtra and Karnataka have come up with their specific policies for EVs. A single policy framework is required for a country like India, where implementation is an issue even in the most progressive of states. Left at their leisure, most of these states will fall behind in policy formulation and implementation.

Image credit: Office of R.K. Singh via Twitter

Saumy Prateek Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.