April 18, 2021
Lithium-ion batteries and sustainable alternatives like methanol and ethanol are to be used.
GOI aims to infuse EV in 30% of private transport, 70% of commercial vehicles, and 30% in buses.
Upfront costs, as well as high working capital, are two key pain points experiences by the sector.
The solar power ecosystem and ancillary industries will require strengthening to support the EV sector.
India’s potential for becoming a powerhouse of Electric Vehicle manufacturing was highlighted by Union Minister Sh Nitin Gadkari at the Amazon Smbhav 2021 conference. The Atmanirbhar Bharat initiative continues to give the automobile sector and other sectors of the economy greater impetus to produce all components locally. Sh Gadkari highlighted that India had the potential to take on the complete indigenous manufacturing of lithium-ion batteries and promote the incorporation of flex-fuel engines in EV integration. With clean energy, green mobility, and sustainability becoming policy priorities, Sh Gadkari emphasized that the Government of India has set 2030 as the target year for the inclusion of EVs in public transport (30%), private vehicles (30%), two and three-wheelers (80%) and commercial vehicles (70%). The Union Minister remarked “India has got tremendous capability for making green power… Within six months, I am confident that we will be in position to make 100 percent lithium-ion battery in India, there is no shortage of lithium.” The development of Hydrogen Fuel cells, bio-CNG, methanol, and ethanol-based solutions were the other key priority areas articulated.
Experts in the automobile and EV space opine that the existing supply chain in the automobile ecosystem will have to be fine-tuned to aid self-sufficiency. A few relevant areas in which progress can be made include (i) implementing efficient measures to reduce working capital required by manufacturers, (ii) quality and assurance control, (iii) enhancing FDI inflow through collaboration with competent foreign partners, (ii) reduction of the upfront cost of EV production. Experts also point out the need to create infrastructure for the storage of sustainable energy created given their potential impact on grid balancing. The value chain could stand to benefit greatly through the strengthening of ancillary companies and the solar power ecosystem such that charging stations can be set up in as many locations as possible. Efforts to enhance EV consumption among the general public would also require manufacturers to usher in a concerted knowledge management drive. The success of EV manufacturing and production will be bolstered by consumer confidence and innovative solutions to overcome the problems facing rural and urban commuters.