Lithium battery demand to soar in India as EV adoption accelerates

Lithium battery demand surges in India as EV adoption gains momentum. Get ready for the electric revolution!

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India anticipates a significant rise in demand for lithium batteries used in electric vehicles (EVs) over the next decade, backed by government incentives for clean energy. But if you are looking for the battery for your car, bike and scooter check out here on battery.carbike360.

Projections for EV Penetration and Battery Demand

A report by Axis Capital predicts that by the financial year 2032-33, EVs will comprise 50% of India's automotive market, necessitating 250-500 GWh of batteries. Achieving this will require an initial capital investment of USD 30-33 billion and government incentives amounting to INR 1.8 trillion over FY24 -28.

Factors Driving EV Adoption

Several factors will drive EV adoption, including new model launches across different price segments, reduced GST rates, the Auto PLI Scheme, benefits under the FAME Scheme, and improved total cost of ownership (TCO) of EVs, which may result from potential reductions in battery prices.

Challenges in Domestic Battery Industry

The report also identifies challenges in developing India's domestic battery manufacturing and recycling industry, such as limited availability of raw materials, high import dependence, and environmental concerns.

Global Implications for Critical Minerals

The increased battery demand in India will have global implications for critical minerals like lithium, cobalt, and nickel. The International Energy Agency (IEA) noted that despite a 180% production increase since 2017, lithium supply fell short of demand in 2021 and 2022, with a significant portion allocated to EV batteries.

Measures for Supply Chain Sustainability

The IEA suggests that innovation in advanced battery technologies requiring fewer critical minerals, support for optimized battery size in vehicles, and the development of battery recycling will be crucial for ensuring supply chain sustainability, resilience, and security.

Market Growth and Players

The India lithium-ion battery market, valued at USD 2.48 billion in 2023, is projected to reach USD 5.49 billion by 2028, with a compound annual growth rate (CAGR) of 17.21% during 2023-2028. Key players in this market include Exide Industries, Amara Raja Batteries, Tata Chemicals, Reliance Industries, Adani Group, and Mahindra & Mahindra. Foreign companies like Tesla, LG Chem, Panasonic, Samsung SDI, and CATL are also entering the market.

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