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India would require spending 20 lakh crore for its electric vehicle dream by 2030 says NITI Aayog

Government-owned think tank NITI Aayog along U.S based Rocky Mountain Institute released the first two of a series of policy briefs addressing India’s obstacles and opportunities on the path to a shared, electric, and connected mobility future.

  As the government strives to work towards its commitment to electrify cars in India by 2030, these extensively researched reports outlines “India’s Energy Storage Mission.” Reports say that to meet ambitious EV plan through 100% domestic manufacturing of batteries would require at least 3,500 GWh of batteries at cost of Rs 20 lakh crore from 2017-2030. However, this will also result in lower oil imports and be saving money on oil imports “India’s mobility transformation presents an enormous economic opportunity for India. Innovative business models and supportive policy frameworks can help make India a global hub for manufacturing electric vehicles and their components, accelerating this transition while creating jobs, strengthening Indian industry, and cleaning the air,” said Amitabh Kant, CEO NITI Aayog.

 India’s Energy Storage Mission further indicates a sustainable way to achieve mobility in India that is in line with its aspiration to achieve 100% electric vehicle (EV) sales by 2030. India could become one of the world’s leaders in battery manufacturing. To do so, India will require a strategy to overcome its nascent position in battery manufacturing and, claim an increasing share of this industry’s value. India’s leapfrog vision of a shared, electric, and connected mobility system could create a US$300 billion domestic market for electric vehicle (EV) batteries by 2030, representing nearly two-fifths of global EV battery demand according to a new report, “India’s Energy Storage Mission,” released by NITI Aayog and Rocky Mountain Institute.

 Since a battery currently accounts for about one-third of an EV’s total purchase price, reducing battery costs through rapidly scaling production and standardizing battery components could be a key element of long-term success for India’s automotive sector. Based on historic learning rates, demand for EV batteries in India could drive down global battery prices by as much as 16 percent to $60 per KWh by 2030 (compared to projections that do not include India’s EV goals). The report estimates that India can capture 25–40% of the total economic opportunity represented by EV battery manufacturing under a scenario where India imports lithium-ion cells and assembles these cells into battery packs. As India’s battery manufacturing capabilities mature and supply chains develop, potentially with new battery chemistries, India has the opportunity to produce both cells and packs, while importing only the cathode or its raw materials. By following this path, India stands to capture nearly 80% (US$240 billion) of the economic opportunity over time.

Coordination among industry stakeholders and government can help to define a pathway to growth and competitiveness by establishing a shared technology roadmap, creating common standards, and aligning policies. In the report, NITI Aayog and RMI recommend that India create a consortium including representatives from the battery industry, OEMs, government, and subject experts. India has certainly got the world’s attention and going forward we expect global leaders in EV and better technology to invest in India once a clearer roadmap is established by the Government. Experts believe that by early 2020 the cost of an electric vehicle will be similar to that of an ordinary car with a combustion engine. With prices of an electric battery going down by almost 80% it will be feasible for automakers to make affordable electric cars.


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