Lithium gigafactory target is raised to 50 GW, tender likely soon

The government is considering financial incentives such as import and export duty waivers to woo battery manufacturers to set up a globally competitive manufacturing base in India.

June 11, 2019 Uma Gupta

The government has raised its ambition for a domestic battery manufacturing industry from 40 GW of annual capacity to 50 GW.

Photo by Abby Wilcox for pv magazine.

Domestic and overseas manufacturers could soon be invited to set up 50 GW of lithium-ion battery production capacity in India with the government set to consider proposals for financial incentives such as subsidies and duty cuts within a week. That would mean a raised ambition from the previously stated 40 GW aim of the government’s ‘lithium gigafactories’ initiative.

“Financial incentives could include reducing minimum alternate tax [duty] by half and import and export duty waivers or cuts for eight years for successful bidders,” stated a quote attributed to a senior official from government thinktank NITI Aayog in a report in the Economic Times newspaper.

To ensure timely establishment of the hoped-for manufacturing base, bidding and project completion timelines are expected to be stringent.

“NITI Aayog will have to conclude the bidding in six months from cabinet approval … the companies will have to set up the manufacturing facilities by 2022, after which they will get the incentives for eight years until 2030,” the official reportedly told the newspaper.

The government has already sought proposals from states about land availability and potential waivers for battery manufacturers. In all, 5-20 locations are likely to be identified. Companies would be invited to bid for setting up battery plants at shortlisted locations.

Telangana has pitched for a 5 GW lithium ion plant by announcing the ready availability of 200 acres of land plus power and water for the fab at a concessional rate.

The India Energy Storage Alliance expects the market for energy storage to rise to more than 300 GWh by 2025. India currently imports almost all its li-ion batteries and cells. With its ambitious lithium gigafactories plan, the government hopes to cut the country’s dependence on imports as it aims to ensure 30% of road vehicles are electric by 2030.

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