TL;DR
India's ₹18,100 crore ACC PLI scheme for EV battery manufacturing is significantly behind targets due to unrealistic timelines, DVA challenges, and selection criteria.
An ambitious ₹18,100 crore scheme aimed at boosting the domestic manufacturing of advanced chemistry cell (ACC) batteries for Electric Vehicles (EVs) in India is currently experiencing significant setbacks. The Advanced Chemistry Cell Production Linked Incentive (ACC PLI) scheme, which targeted 50 gigawatt-hour (GWh) of battery cell production by 2025, has only seen 1.4 GWh installed.
Reports indicate that approximately 8.6 GWh of capacity is under development but is delayed, while a substantial 20 GWh has shown no progress whatsoever. This lag in implementation also extends to job creation, with only 1,118 jobs generated, a mere 0.12% of the estimated 1.03 million jobs targeted. Furthermore, only 25.58% of the projected investment has been attracted.
Reasons cited for the scheme's struggles include an unrealistic two-year gestation period for building complex gigafactories in a nascent market and difficulties in meeting Domestic Value Addition (DVA) requirements due to India's insufficient mineral processing facilities. Moreover, the evaluation criteria of the scheme, which prioritized DVA and subsidy benchmarks over prior manufacturing experience, led to established battery players being overlooked in favor of newer entrants.
