India is making significant strides in promoting renewable energy. By the year 2030, the country aims to meet 50% of its primary energy needs through renewable sources. There’s also an anticipated increase in the demand for lithium-ion batteries. By the financial year 2027, electricity demand in the country is expected to rise to 54 gigawatts and could reach 127 gigawatts per hour, up from the current 15 gigawatts per hour.
Currently, India meets its lithium-ion battery needs through imports.The government’s commitment to a green future is clear, not only in its renewable energy goals but also in its push for electric vehicle (EV) adoption. The primary goal is to have 30% of vehicles on the road as electric by 2030. India has already set a target of 40 GWh of integrated battery capacity under the Production-Linked Incentive (PLI) scheme, with plans to allocate the remaining 10 GWh soon.
This suggests that traditional battery manufacturers will likely establish battery capacity outside of this scheme in partnership with other companies. Initiatives like the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) program and the Battery Energy Storage Systems (BESS) have played a vital role in reducing costs associated with EVs and BESS, leading to an increase in demand.
According to CareEdge Ratings, battery imports are projected to remain at just 20% by 2027. This shift is expected to lead to rapid growth for companies involved in the renewable energy sector. Hardik Shah, a director at CareEdge Ratings, mentioned that demand is expected to grow, primarily shifting towards EVs and renewable energy storage needs. The anticipated expansion in the lithium-ion battery sector is not only beneficial for the environment but also presents attractive opportunities for investors and companies in the stock market. The development of gigawatt-scale integrated battery capacities within India will significantly reduce the country’s dependence on imports.
