Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain

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1Overview of EV Adoption in India
Promoting
Clean Energy Usage
Through Accelerated
Localization of
E-Mobility Value Chain
May 2022 2Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain 3Overview of EV Adoption in India
Promoting
Clean Energy Usage
Through Accelerated
Localization of
E-Mobility Value Chain
May 2022 4Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
NITI Aayog
Sudhendu Jyoti Sinha
Joseph Teja
Sujit Jena
Asian Development Bank
Sabyasachi Mitra
Jiwan Sharma Acharya
Keerthi Kumar Challa
Boston Consulting Group
Natarajan Sankar
Sushma Vasudevan
Rajat Modwel
Aditya Khandelia
Akash Sethia
Authors
The authors would like to thank Mr. Amitabh Kant, CEO, NITI Aayog for their support that made
this report possible.
The views and opinions expressed in this document are those of the authors and do not
necessarily reflect the positions of the institutions or governments. While every effort has been
made to verify the data and information contained in this report, any mistakes and omissions
are attributed solely to the authors and not to the organization they represent.
This publication was produced as a part of TA 6726-IND: Promoting Clean Energy Usage
Through Enhanced Adoption of Electric Vehicles and Grid Integration of Battery Storage System,
co-financed on a grant basis by the Asian Clean Energy Fund, established by Government of
Japan, under the Clean Energy Financing Partnership Facility and administered by ADB.
Acknowledgements
Authors &
Acknowledgments 5Overview of EV Adoption in India
Disclaimer
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May 2022
This document is fact based and is not intended to make or influence any recommendation
and should not be construed as such by the reader or any other entity. 6Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Table of
Contents
Executive Summary
Introduction
01 Overview of EV Adoption in India
1.1 Approach 16
1.2 Overall EV adoption outlook in India 20
1.3 Accelerators & inhibitors 21
02 Benchmark of Global Best Practices
2.1 Framework and approach 24
2.2 Global best practices 25
2.2.1 Demand side drivers 25
2.2.2 Supply side drivers 31
2.2.3 Ecosystem enablers 36
03 Assessment of EV Supply Chain
3.1 The EV value chain 50
3.2 Impact of current government initiatives 51
3.3 Methodology for deep-dive 53
3.4 Challenges to localization & key interventions required 55
04 Proposed Reforms and Roadmap for India
4.1 Proposed interventions 62
4.2 Conclusion and way forward 76
List of abbreviations79 Automotive industry, globally, is at a tipping point. In the last few years, the discussions have
shifted from “will Electric Vehicle (EV) become mainstream?” to “the future of transport is
electric”. By the end of 2021, more than 15 countries had come forward and committed to
the complete phasing out of ICE vehicles. Regulatory targets across many countries in the
European Union now aim for a ban on ICE vehicles by as early as 2030 and 2035. Responding
to climate change, mitigating pollution levels in urban centers, and reducing dependence
and spends on fossil fuels have been the primary drivers behind governments pushing the
electrification agenda.
India has been taking rapid strides towards green energy and electrification in the recent past.
At COP26, the Honorable Prime Minister announced a net zero target for India by 2070. With the
transport sector being one of the biggest emitters, the electrification of vehicles will be crucial
in helping India achieve this goal. As part of the National Electric Mobility Mission Plan (NEMMP)
2020, the government has already started setting the stage for rapid uptake of electric vehicles
through launch of various demand drivers and ecosystem enablers. With the development of
the required EV ecosystem, increased participation from industry, and supportive government
policies, electric vehicles in India are set to grow exponentially over the next decade. Overall EV
adoption rates are expected to reach 10-12% by FY26 and 30-35% by FY30. It is estimated that
11-13 million EVs will be sold annually in India by FY30, led by E2W where penetration is expected
to reach 35-40% by FY30. E3W, E4W (shared) and E-Buses will also witness substantial EV
adoption over the next decade (between 15-25%) driven by favorable economics, increased
vehicle options and government push towards electrification.
Globally, great strides have been made to drive EV adoption and make EVs the vehicle
of choice for consumers. Several policies and regulations have been implemented by
governments across the world to build a robust ecosystem that enables EV adoption. To
arrive at the appropriate set of learnings for India, best practices across the globe were
benchmarked across 11 levers to cover all the three drivers of EV adoption – Demand side,
Supply side and Ecosystem enablers. On the demand side, policies cover fiscal incentives,
supporting incentives, financing support and consumer awareness initiatives to stimulate
demand. Key thrust areas on the supply side include manufacturing and R&D support.
Ecosystem enablers include ICE sale restrictions / emission regulations to promote OEM
electrification, adoption of charging infrastructure, standards and specifications, upskilling
programs for workforce, and creating a circular economy.
Correspondingly, to support the EV adoption trajectory in India, the Government of India
has recently launched several initiatives with the aim of developing a full-fledged EV
manufacturing ecosystem in the country. Each of the three Production-linked Incentive (PLI)
schemes – ACC PLI, Auto PLI and Auto components PLI – have seen strong participation from
industry and are expected to localize various parts of the EV value chain. Similarly strong
localization momentum has been created with the Phased Manufacturing Program (PMP)
for EVs, leading to an accelerated development of local supplier base across components.
However, these policies address only certain parts of the value chain and structural gaps
remain in key areas. Therefore, as part of this report, a comprehensive analysis of the complete
electric mobility value chain (detailed in the figure) was conducted to identify these gaps. The
entire e-mobility value chain was broken into components and sub-components to identify
those areas where additional government thrust is required to drive localization.
Executive
Summary Cell Component
Manufacturing
Other EV Specific
Components
Charging
Infrastructure
Battery Assembly
Based on the exhaustive study, the following key challenges to localization have been
observed in these components:
1. Lack of level playing field for select components owing to structural unit cost
disadvantages for production in India (e.g., in the case of CAM NMC and Electrolyte,
because of unavailability of RM & RM processing locally).
2. Limited enabling ecosystem to support high capex greenfield investment in India vis-
à-vis other countries for select Cell components (e.g., investments in CAM, Separators,
Copper Foil, AAM have individually received capital grants in Europe along with access to
cheap financing, thereby enjoying superior project ROCE).
3. Lack of local R&D experience in high-tech Cell component fields like CAM manufacturing,
Copper Foil manufacturing, etc.
4. Low availability of highly skilled labor e.g., for CAM, Copper Foil, BMS manufacturing, etc.
5. Limited localization mandate to ensure enforcement of phased manufacturing programs
for EVSE.
Cathode Active
Material (CAM)
1
Copper foil2
Separator3
Electrolyte4
Contactors
6BMS
Anode Active
Material (AAM)
5
Controller
9
Connector
(Type 2)
Connector (CCS/
CHAdeMO)
11
10
AC charger
assembly
13
12
Rectifier8
Rare earth
magnets
7
Other EV specific components
Charging
infrastructure
EV assembly
by OEMs
Traditional auto components
Cell component
manufacturing
Cell
manufacturing
Battery
assembly
E-motor drive Power electronics EV electricals
For each element of the value chain, following a comprehensive benchmarking and
discussion with industry experts, the current supplier landscape was mapped out for all the
key components. Thereafter, for components that are currently being imported, drivers of
localization in other key geographies were analyzed to understand key success factors for
localization. To emulate the best practices, the key drivers were then contextualized for India
along with a mapping of India’s starting point against each success factor. This structured
methodology was repeated for each element of the e-mobility value chain to identify 13
components where additional government thrust would be required to drive localization Set up Hi-Tech
EV component
corridor
Ensure mineral
security of key battery
RMs
Upgrade existing infra
and faculty skill set
Develop National
strategic R&D agenda
for EV
Project financing
commitment from
banks for e-mobility
projects
Enable mining of
Neodymium in
India
Curate curriculum
for Univ/ ITIs/ VETs,
etc
Set up EV & Battery
Innovation hubs
Offset structural unit
cost disadvantages
Set up Raw Materials
Investment Platform
Enable on-demand
‘Phygital’ learning
Incentivize
investments in
R&D
Consider localization
mandate for EVSE
Explore opportunities
to attract greenfield
project investments
Promote
sustainability
standard & ethical
sourcing
Set up Centers of
Excellence (CoE)
11013
14
15
16
11
12
2
3
4
9
8
7
6
5
Promoting Clean Energy Usage through Accelerated
Localization of E-Mobility Value Chain
EV & EVSE component
manufacturing at scale
Mineral security &
availability
Re-skilling & Up-skilling
workforce
R&D for EV
innovation
Thrust Area 1 – Enable EV & EVSE component manufacturing at scale by creating an
enabling eco-system and a level-playing field for select high priority components
Existing initiatives like PLI programs, PMP deadlines, etc have started the localization journey
but there is further opportunity to address need-gaps to accelerate the momentum. Given
many of these components would require high capex (greenfield project) investments (200-
500M$ for 20-30 GWh plant), creating an enabling investment ecosystem to support at-scale
manufacturing will be key to achieving the vision of complete indigenization of and self-
sufficiency in the EV value chain. This can be done through concerted focus along the following
dimensions:
1. Develop Hi-Tech EV component corridors, along existing auto belts, in partnership with
state governments: Salient features of the corridor would include earmarked land near
auto-clusters, plug-and-play production facilities and access to shared infrastructure to
support expedited start of operations.
2. Provide green financing commitment from banks for supporting large-scale greenfield
project investment in India (especially for CAM, AAM, Copper Foil & Separators): Taking
cue from the green financing commitments secured by EU from local banks such as EIB
To address these challenges and further develop the local EV value chain, a 16-point action
agenda across 4 key thrust areas is proposed: and EBRD, it is crucial for the government to work with the financial sector to channelize
lending towards more sustainable technologies and businesses (e.g., EV Cell component
manufacturing projects).
3. Provide support to offset structural unit cost disadvantages for production in India:
Few components like CAM NMC and Electrolyte face structural unit cost disadvantage for
production in India vs peer geographies (E.g. China). Through measures like duty relief
for import of PCAM (RM) or inclusion of CAM NMC and Electrolyte into PLI scheme, the
government could facilitate creation of a level playing field for the local manufacturing of
these components.
4. Explore opportunities to attract greenfield project investments in select high priority
Cell components where need-gap still exists despite the PLI schemes: Various state
governments (E.g., Karnataka) are offering up to 15% of project capex as capital subsidy
for Cell manufacturing (which overlaps with ACC PLI). This support could instead be
channelized for the need-gap components (i.e., CAM NMC, AAM, Copper Foil & Separators).
5. Consider localization mandates to accelerate set up of EVSE component manufacturing
& assembly in India: The government could consider introducing localization criteria in
tenders by DHI and State Nodal Agencies (under Bureau of Energy Efficiency) across the
country for setting up public charging stations (PCS) to accelerate localization of EVSE
components & their assembly.
Thrust Area 2 – Ensure consistent availability of critical & strategic EV raw materials
to strengthen mineral security of the nation
India is dependent on imports for most raw & advanced Battery materials (E.g., Lithium,
Nickel, Cobalt, etc.). Further, India is heavily dependent on specific geographies for Rare-
Earth Permanent Magnet – a critical sub-component of E-Motors. To make India self-
sufficient across the raw material value chain and to make it resilient to geo-political shocks,
it is crucial to diversify India’s supply chains and ensure a consistent supply of critical and
strategic minerals to Indian domestic market. This would need a holistic focus across following
dimensions:
6. Ensure mineral security of key Battery raw materials: Key Battery raw materials such
as Lithium and Cobalt are already covered within KABIL’s ambit. It is imperative to also
secure supply of other key Battery RMs like Nickel, Copper (with limited local reserves) and
Manganese (with limited local reserves) by identifying on a global level primary sources
(mining) and secondary sources (re-cycling), and consequently driving strategic trade
partnerships with resource-rich countries. This may be achieved either by setting up a
central nodal agency or directing an existing PSU/ group of PSUs to carry out this initiative.
7. Enable mining of Neodymium in India for producing Permanent Magnets: There is a
need to direct IREL’s focus towards Neodymium mining at scale; provide funding support
for setting-up Neodymium processing, refining and reduction facilities in India as well
as create a level playing field; and incentivize exploration of alternate sources (for e.g.,
Carbonatite reserves) of Neodymium, beyond Monazite sand.
8. Set up a Raw Materials Investment Platform (RMIP) to help leverage investment (JVs) in
a pipeline of key projects: Like ERMA in Europe, India could consider setting up a platform
for investment matchmaking to ensure high investment success rates across the prioritized
cases to secure primary and secondary raw materials’ supply.
9. Establish sustainability standard and certification scheme to ensure high quality and
sustainable output by domestic players & promote ethical sourcing and transparency in
value chain by enforcing the respective standards: India needs to establish a minimum
quality standard for ensuring sustainability in the raw material(s) value chain. 11Overview of EV Adoption in India
Thrust Area 3 - Foster centrally coordinated multi-stakeholder efforts for R&D in EV
innovation
Thrust Area 4 - Foster industry-academia collaboration for re-skilling and up-skilling the
Indian workforce in line with skills and competencies needed to emerge as a leader in the
growing Battery & EV manufacturing ecosystem
EV and Battery are key pillars for transition towards sustainable mobility, and to be at the
forefront of the e-mobility industry, continuous investment in R&D is critical. India will need
to invest ahead of the curve in R&D to accelerate adoption by improving Battery energy
density and cycle lifetime, and reducing cost, etc. Given that India presently lacks the process
expertise for producing many complex EV and Battery components (E.g., CAM, AAM, Copper
Foil, Electrolyte) requiring high technical know-how to ensure high yield, it is even more critical
to support indigenous players in developing competitive technology (vis-a-vis global players).
This would require focus on the following levers:
10. Develop India’s EV & Battery specific strategic research agenda covering short-,
medium- and long-term R&D priorities: Government could orchestrate the industry-
academia-startup collaboration by laying out a national EV and Battery strategic research
agenda covering short-, medium- and long-term R&D priorities. Potential short/medium-
term priorities include increase battery energy density, improve cycle lifetime, etc. while
long-term focus could include developing self-healing functionalities for battery, identify
novel chemistries beyond li-ion, etc.
11. Provide funding to develop the required infrastructure for EV and Battery Innovation
hubs within reputed institutions, to promote collaborative research between Industry,
Startups and Academia: E.g., set up of innovation labs providing testing and prototyping
infrastructure and supporting commercial product development from lab prototype,
creating an innovation platform (digital) to host R&D projects based on identified priorities
and invite EV/Battery stakeholders to further the research agenda, etc.
12. Provide incentives to industry, academia, and start-ups to conduct collaborative
research across identified priority areas: Based on learnings from global benchmarks, it is
pertinent to facilitate access to funding sources for conducting research and for prototype/
commercial product testing (as observed in Horizon Europe program in EU). Additionally,
incentives can also be provided for development & deployment of proprietary EV software,
given its high relevance in purchase decision of consumers.
Given the nascent stage of India’s EV and Battery market, we presently lack the skilled expertise
and technical know-how required for producing many EV specific components. To support
India’s high ambition for substantial electrification of transport by 2030, it is critical to design a
blueprint for competences and training schemes of the future in collaboration with key EV and
Battery stakeholders. The following aspects need to be focused on to set a solid foundation for
success:
13. Develop existing infrastructure and faculty skillset to enable Battery & EV skill
development amongst students: There is a need to upgrade existing training infrastructure
for enabling best-in-class EV and Battery skill development, as well as to train faculty for
ensuring impartation of requisite industry-ready Battery and EV skills.
14. Design curated curriculum for skilling new age EV and Battery workforce: Design and/
or refresh course curriculum across universities, ITIs, VETs, Polytechnics in consultation
with industry-academia. Integrate the new/ revamped curriculum in the existing degree,
diploma, certification, or training programs. 12Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
15. Work with technology partners to design on-demand ‘Phygital’ learning courses for up-
skilling existing workforce: Based on skill-gap assessment conducted and inputs received
from industry-academia, design on-demand courses to fill knowledge and skill gaps of
existing workforce in the Battery and Automotive industry.
16. Set-up Centers of Excellence in reputed universities, in collaboration with OEMs and key
Cell / Battery manufacturers: The CoEs would work with industry partners to define the
curriculum (duration, modules, etc.), that would be directly relevant for industry placement
of students.
To realize India’s mission of becoming a globally competitive powerhouse in battery & EV
manufacturing, it is imperative to have a holistic strategy to drive concerted localization
across the EV value chain. If the proposed actions across these 4 key thrust areas (in addition
to ongoing efforts) are executed effectively, the results can be transformative for India’s
e-mobility landscape. It will not only accelerate local EV adoption, but also put India on the
roadmap for developing a competitive and self-sufficient domestic manufacturing ecosystem
for electric mobility.
Our analysis indicates that the incremental market size of EV & EV components and charging
infrastructure is likely to reach ~$22 Bn by 2030. The thrust provided by ongoing government
initiatives, coupled with actioning of the additional interventions enlisted in this report, has the
potential to substitute imports to the tune of ~18 Bn, i.e. ~80% of the incremental market size of
EVs. The opportunity at stake is massive. This reports provides a path to localizing as much of
this value at stake, as possible. 13Overview of EV Adoption in India
Introduction
At COP26, the Honorable Prime Minister announced a five-point agenda, referred as
‘Panchamrit’, to highlight the role of India towards fighting global climate change. It
emphasizes the focus on clean energy to reduce carbon emissions, by increasing non-fossil
energy production capacity to 500 GW and achieving 50% of country’s energy requirements
using renewable sources by 2030. India has also committed to reducing its projected carbon
emissions by 1 Bn tonnes by 2030 and to reducing the carbon intensity of the economy to
less than 45% by 2030. As the final agenda, India has also pledged to become a ‘Net-Zero’
economy by 2070.
With the transport sector being one of the biggest emitters, the electrification of vehicles will
be crucial in helping India achieve these goals. India is the 4th largest automobile market in
the world after China, USA and Japan. Therefore, India will play a pivotal role in the quest for
Electric Vehicles (EVs) in the changing global order. The opportunity to drive EV adoption will
provide immense opportunities for EV companies and component manufacturers in India.
The EV sector is still at a nascent stage in India. For it to offer a real challenge to the traditional
automotive industry, it is important that it focuses on key internal aspects such as the supply
chain. The EV supply chain needs to be localised, which presents its own set of challenges and
opportunities, which are captured in this report.
The first chapter of this report focuses on detailing out the overall outlook for EV adoption in
India. The second chapter provides an extensive benchmarking of the best practices adopted
across the globe to drive EV adoption and to accelerate localization of the EV supply chain. In
the third chapter, the current state of the local EV supply chain has been assessed in depth
to identify structural gaps. Findings of this chapter form the bedrock of the proposed reforms
and roadmap for India captured in chapter four. As the world speeds towards electric mobility,
India too needs to do its bit to ensure that it remains a strong contender in the race. 14Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
01
Overview of EV
Adoption in India 15Overview of EV Adoption in India 16Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Vehicle sub-
segments
(e.g., hatch
vs SUV)
Baseline (FY21A)
1.1 Approach
Government of India has already set the stage for rapid adoption of EVs through multiple
demand drivers like purchase incentives, road tax waivers, scrapping, and retrofit incentives.
Still, any sustainable adoption will also be dependent on other factors coming together beyond
the fiscal thrust. For example, despite the FAME 1 and FAME 2 subsidy available for the last 5-6
years, categories like E2W / E4W haven’t fully taken off (until recently) because of challenges
from other drivers to EV adoption like the lack of competitive EV vehicle options, unfavorable
economics (TCO parity), high upfront cost and a nascent public charging ecosystem.
Therefore, it becomes important to project EV penetration by understanding and analyzing the
outlook across each of these EV adoption drivers. In this report, the demand for electric vehicles
has been projected across five different vehicle categories (2W, 3W, 4W, LCV, Bus). Each vehicle
category is further split into multiple sub-segments based on product type/use case (i.e.,
customer segment) given each sub-segment has its own characteristics and is expected
to behave differently to the five drivers of EV adoption, thereby having a different adoption
timeline and penetration trajectory.
Consequently, the following comprehensive EV penetration framework has been applied for
projecting EV adoption across each of the vehicle categories.
The three elements of the framework have been further detailed out ahead :
Exhibit 1: Framework developed to project EV penetration across each vehicle category
Varying relative weightage based on sub-segments
123
Automotive
industry
segmentation
EV adoption
curves
Drivers of EV adoption
EV Penetration
TCO
sensitivity
• TCO
• Govt
incentives
(financial)
• Upfront
cost
differential
• Financing
options
• Public
charging
networks
• Battery
swapping
models
• OEM
vehicle
options
• Vehicle
perfor-
mance
• EV
mandates
• Non-fiscal
incentives
Price
sensitivity
Charging
infra
readiness
Need for
comparable
product
specs
(tech
readiness)
Policy
measures
Customer
segments
(use-cases)
B C D EA
EV penetration
trajectory
= 17Overview of EV Adoption in India
1.1.1 Automotive industry segmentation
1.1.2 Adoption drivers
As highlighted earlier, EV adoption is dependent on multiple factors coming together to drive
the transition to electric. These factors have been summarized into five key adoption drivers:
TCO viability, price sensitivity, charging infrastructure readiness, product readiness, and policy
support. Additional details on each driver have been outlined below:
• TCO viability compares the total cost of owning and running an EV vs. an ICE vehicle.
It is driven by the purchase cost of the vehicle (inclusive of financial incentives by the
government), annual operating costs over the vehicle ownership duration, and the residual
cost of the vehicle. Purchase of vehicles is a major investment decision for most Indian
consumers, with a high emphasis on the overall vehicle economics. Hence TCO viability is
a critical driver of electrification. While EV variants have already achieved TCO viability for
select sub-segments, TCO viability for other sub-segments is expected to be achieved over
the next few years. A sharper decline in the costs is expected to prepone the EV adoption
timeline.
Electrification trajectory for a Scooter (2W) fleet operator segment (e.g., food delivery
aggregators) will be different compared to the user segment which only uses the scooter for
commuting to work. For the former, since utilization is high, the TCO is already positive, while for
the travel for work segment, TCO parity is expected to be achieved only in 1-2 years driven by
declining battery prices. Similarly, for motorcycles even though the TCO viability is favorable for
fleet operators, there are currently very few product choices available in the market, hindering
adoption. Hence, it is essential to take a de-averaged view of the industry segments to project
the likelihood of EV adoption. Each sub-segment has its own characteristics and is expected
to behave differently to the five drivers of EV adoption, thereby having a different adoption
timeline and penetration trajectory.
Consequently, industry volumes across the five vehicle categories (2W, 3W, 4W, LCV, Bus) are
divided into 30+ sub-segments based on product type /use case (i.e., customer segment) to
understand the overall EV adoption timelines at a granular level.
Exhibit 2: Industry segmentation across vehicle categories
30+ sub-segments defined across all vehicle categories
4W LCV Bus 2W 3W
Shared
Sedan
<4m SUV
>4m SUV
Hatch
MPV
Private
3.5 – 7.5T
Organized
Unorganized
Rural
Organized
Unorganized
Rural
Urban
Urban
2 – 3.5T
< 2T
Short
distance
Long
distance
Intra-city
Intra-city
Inter-city
School + Staff
Others
(e.g., tourism)
Inter-city
STU
Private
Travel for work
Travel for fun/
leisure
Fleet riders
Travel for work
Travel for fun/
leisure
Adventure
Fleet riders
Scooter
MotorcycleOrganized
Unorganized
L5 Urban
Permit capped
Low L3
High
L3
Passenger
Cargo
Non-
Permit
capped
L3
(E-rickshaws)
Rural 18Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
• Price sensitivity accounts for the upfront cost differential of EVs vs. ICE vehicles. Even if the
total cost of ownership is lower for EV variants vs. ICE vehicles, it is crucial to account for
the impact of higher upfront costs during the purchase decision. Availability of attractive
financing options has significant potential to drive affordability for purchasing EVs. But
due to the initial phase of EVs and the currently nascent secondary market, financing
options remain limited in many cases, especially for low-income segments (e.g., E3W) and
unorganized commercial segments. Hence, EV adoption is hindered by the upfront price
differential and remains dependent on the availability of financing options to bridge the
gap.
• Charging infra readiness comprises of availability of public charging networks/battery
swapping infrastructure to address range anxiety – a major concern for many customers
considering EV options. This is even more prevalent for segments with high utilization (e.g.,
fleet operators, commercial use-cases) and/or those with unpredictable routes (e.g., cabs,
unorganized last-mile delivery). Several sub-segments cannot afford prolonged downtime
during working hours even if charging stations are available. Hence, the readiness of quality
charging infrastructure to accommodate the needs of various customer segments is vital
to EV adoption.
• Product readiness reflects the breadth of EV models available in the market with features
comparable to ICE models. Vehicle performance is a key purchasing criterion, and it is
imperative for EV variants to compete with ICE vehicles on performance acceleration,
range, payload capacity, speed, etc. Fewer vehicle options hinder choice and thereby act
as major inhibitors to EV adoption.
• Policy measures include government regulations such as EV adoption mandates and
non-fiscal incentives. Regulatory measures, either in the form of additional benefits for EVs
or restrictions on ICE vehicles, can influence other drivers and accelerate the EV adoption
timeline.
The relative importance of each driver will vary for each segment, depending on the segment
characteristics. However, all relevant drivers must be favourable for a segment to embark on
the EV adoption trajectory.
Deep-dive: Total Cost of Ownership
EV adoption across vehicle categories is dependent on a favourable Total Cost of Ownership
(TCO) for EVs compared to ICE vehicles. TCO is computed based on 3 components – purchase
cost of vehicle, annual operating costs and residual value of the vehicle. Each of these
components is driven by different drivers as outlined below.
Exhibit 3: Methodology for computation of Total cost of ownership (TCO)
Residual
Value
Purchase Cost
of Vehicle
Annual
Operating
Costs
1
TCO
Vehicle Cost
Fuel/ electricity
Subsidies
Maintenance
Road tax and reg.
Insurance and
Financing
Resale value
of vehicle
Based on min. of calendar life/
remaining charge cycles
Based on depreciated value
Resale value of
Battery Pack
+
+
+
++
-
-
1. Annual operating costs are multiplied by the duration of vehicle ownership when computing the total cost of ownership 19Overview of EV Adoption in India
Basis the aforementioned methodology, TCO has been calculated for each sub-segment, for
EV vs ICE vehicles
1.1.3 Adoption curve
As with every new technology or solution, the adoption curve here too will be S-shaped
(1)
.
Whenever a new technology comes into existence, the adoption is initially slow because of high
uncertainty, potentially higher costs, and few use cases. This leads to very few early adopters
but once technology costs come down and the complementary eco-system gets developed,
consumer confidence increases significantly. This leads to a surge in adoption rates, until the
market is saturated with the new technology, following which the growth rate drops again.
As a new segment in the transport industry, EVs are still in the relatively early stages of
adoption. Exponential growth in the future is propelled through various factors such as
technological innovations, improved access to charging infrastructure, enhanced product
readiness in line with customer requirements, and policy measures driving electrification. The
five driving factors discussed in the previous section determine the timeline for acceleration of
growth for each of the individual sub-segments.
The sub-segments with low challenges across the five drivers of adoption will display an
exponential growth in near future and saturate once the demand is met. Similarly, sub-
segments that exhibit high challenge to adoption across one or more drivers of adoption are
expected to take relatively longer time for the acceleration of EV growth.
Exhibit 4: TCO parity status vs. ICE vehicles (petrol/diesel) for different vehicle sub-segments
4W LCV Bus 2W 3W
TCO parity already achieved vs. ICE vehicles (petrol /
diesel) , assuming current subsidies
5
TCO parity yet to be achieved vs ICE vehicles
1. TCO parity achieved for E3W vs diesel ICE vehicles but not vs CNG ICE vehicles
2. TCO parity achieved for <2T E-LCVs vs diesel ICE vehicles but not vs CNG ICE vehicles
3. No EV model currently available for 2-3.5T LCV, 3.5-7.5T LCV and Inter-city long distance bus segments
4. Varies based on utilization; achieved for segments >3,000 kms annual run
5. Only central subsidies available under FAME-2 assumed for TCO calculation; state-level subsidies are
not considered
Shared
Sedan
>4m SUV
Hatch
MPV
Private
3.5 – 7.5T
Organized
Unorganized
Rural
Organized
Unorganized
Rural
Urban
Urban
2 – 3.5T
< 2T
Intra-city
Intra-city
Inter-city
School + Staff
Others
(e.g., tourism)
Inter-city
Short distance
Inter-city
Long distance
STU
Private
Fleet riders
Adventure
Fleet riders
Scooter
Motorcycle
Organized
Unorganized
Rural
Urban
Passenger (L5)
Cargo
Non-
Permit
capped
Permit
capped
High L3
Permit
capped
Low L3
Travel for
work
(4)
Travel for
fun/leisure
(4)
<4m SUV
Travel for
fun/leisure
(4)
Travel for
work
(4) 20Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
EV adoption in India is currently at a nascent stage with an overall penetration of <1% in FY21.
But EV adoption is expected to pick up in India over the next few years driven by reduction in
vehicle costs, development of charging infrastructure, wider availability of comparable EV
options and policy interventions in the form of incentives and electrification mandates. The
E2W and E3W segments are expected to drive the bulk of EV volumes in the short term while
E4W volumes are likely to pick up in the long-term.
Consequently, the overall EV adoption rates are expected to reach 10-12% of annual sales by
FY26 and 30-35% by FY30.
1.2 Overall EV adoption outlook in India
Exhibit 5: Overall EV adoption projection in India
Vehicle CategoryFY30 (E)FY30(E)FY26 (E)FY26 (E)
13-15%35-40%2,500-3,000 10,000-11,000
18-20%26-29%85-95160-180
3-4%9-11%160-180550-600
6-7%20-25%20-3090-100
3-5%10-15%15-2580-90
8-9%13-16%5-1010-15
E2W
E3W (ex. rickshaw)
E4W—private
E4W—shared
E-LCV
E-Bus
Overall10-12%30-35%3,000-3,500 11,500-12,500
1. E-rickshaw sales not shown here, E-rickshaw volumes expected ~500K by FY26, ~700K by FY30
2. On a pandemic hit lower industry base of 14-15K (excluding ambulances)
EV Penetration RatesEV Volume (in ‘000s)
Within the E2W category, scooters (forming ~40% of the 2W category) are geared for EV takeoff
driven by favourable economics, multiple new product launches (both by traditional players
and neo-disrupters like Ola, Ather), range anxiety unlock through battery swapping solutions
and government thrust on fleet electrification. On the other hand, motorcycles are expected
to lag scooters in EV adoption because of limited product options currently. But with multiple
OEMs announcing plans to introduce EV variants, motorcycles will also pick pace in the 2
nd
half
of this decade.
In the E3W category, capped urban passenger markets (restricted ICE permits) with a
low presence of L3 e-rickshaws will continue to drive EV adoption due to unlock of latent
demand. Organized players will lead adoption due to fleet electrification mandates, corporate
sustainability policies, and easy access to financing options in the cargo segment. Rural
passenger and unorganized cargo segments will continue to face challenges because of
growing competition from CNG and the need for widespread charging infrastructure.
EV adoption in the E4W category will initially be led by the shared mobility segment
(aggregators, fleet operators, etc.) due to government thrust on fleet electrification and
favorable economics. The major inhibitor for this segment is the high reliance on public
charging infrastructure. Still, EV adoption is expected to pick up with the deployment of
charging stations, especially in Metro/Tier-1 cities. In the private segment, EV penetration is
expected to grow in the <4M SUV segment in the short term. Several EV alternatives are already
available in the market, and TCO parity is expected to be achieved in 2-3 years. Adoption in the
hatch and sedan is expected to be slightly delayed given the lack of product readiness and
high upfront price sensitivity.
In the LCV category, there has been limited EV adoption till now because of poor access
to financing, limited charging infrastructure, a negative TCO vs. CNG vehicles, and thereby
limited thrust from OEMs. However, urban organized players (i.e., last-mile delivery operators, 21Overview of EV Adoption in India
1.3 Accelerators & Inhibitors
The resulting EV projections, as highlighted earlier, are built considering the base case scenario.
However, any aggressive policy intervention from the government or accelerated development
of the EV ecosystem can accelerate EV adoption in India.
The following critical factors can accelerate projected EV adoption rates in India:
• Support offered by the government through upfront subsidies and tax incentives has been
factored into the base case forecast. Any other aggressive policy stance such as OEM
electrification mandates, fleet electrification targets, restrictions on ICE usage in urban
centers, and additional thrust on adoption at the state level (e.g., more states with subsidy
on private 4W) can further boost EV sales.
• Penetration rates can also be accelerated through the faster than expected roll-out of
public charging infrastructure. Along with increased roll-out, private sector participation in
developing the infrastructure will further address concerns around range anxiety and boost
EV adoption.
• Another factor that can propel the adoption curve will be the accelerated evolution and
adoption of new business models like VaaS (Vehicle-as-a-Service) and BaaS (Battery-
as-a-Service). VaaS model involves subscription-based ownership, which can accelerate
EV adoption in certain segments because of low upfront cost for the consumer and higher
utilization for the customer, thereby favorable economics. BaaS models address the issue of
limited public charging infrastructure and reduce range anxiety through the development
of extensive battery swapping networks.
Conversely, the following critical factors can inhibit projected EV adoption volumes.
• Continued limitations and sub-optimal conditions in financing options can significantly
inhibit EV adoption, especially in commercial segments.
• Slower than expected launch of new EV models by OEMs, especially in the 4W and LCV
segment, will also inhibit adoption rates due to limited EV model options.
• Adoption will also be impeded by a slower than expected decline in battery prices, leading
to higher than expected vehicle costs and the consequent persistence of high-cost
differential vs. ICE.
e-commerce players, etc.) are likely to be the torchbearers of EV adoption in this category over
the next 4-5 years, driven by the push for fleet electrification, availability of financing options,
and new product launches.
Electrification in the bus category will be led by STU intra-city sub-segment because of strong
government push and subsidy support. Short-distance inter-city sub-segment is likely to
pick up adoption towards the latter half of the decade with the development of fast-charging
infrastructure, which is a crucial requirement for inter-city travel. School + staff buses (making
up for 50%+ of the category) will see limited EV adoption in short to medium term because of
negative TCO, driven by low utilization levels.
Electric vehicles are the inevitable future, and India is on a strong momentum to achieve
electrification of transport.. While the government is trying hard to stimulate EV demand, some
challenges remain to be addressed – e.g., availability of competitive financing options to drive
affordability, widespread public charging network to address range anxiety, and accelerated thrust
from OEMs to launch competitive EV products. Globally, we see governments step in and take an
active role in shaping policy measures across all levers of EV adoption (beyond fiscal incentives).
Hence, in the next chapter, the best in class policy measures across all the critical drivers of EV
adoption have been benchmarked.
References:
1. Maggie Dennis 2021. Are We on the Brink of an Electric Vehicle Boom? Only with More Action. World Resources Institute. https://
www.wri.org/insights/what-projected-growth-electric-vehicles-adoption
2. SIAM monthly flash reports 22Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
02
Benchmark
of Global Best
Practices 23Overview of EV Adoption in India 24Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Globally, great strides have been made to drive EV adoption and make EV the vehicle of choice
for consumers. Several policies and regulations have been implemented by governments
across the world to drive EV penetration. These initiatives can be categorized across 3 types
– Demand drivers, Supply drivers and Ecosystem enablers. Within each, different levers have
been deployed which are summarized below:
Exhibit 6: 11 areas for government policies & regulations to drive EV adoption
2.1 Framework and approach
Ecosystem
enablers
Demand
side drivers
Supply
side drivers
5
6
Sale restriction / emission
regulations
Fiscal incentives (purchase
subsidies, tax exemptions …)
Supporting incentives
(preferential access,
reserved parking …)
Financing support
Consumer
awareness/ education
Charging
infrastructure penetration
R&D thrust (Initiatives to boost
R&D spends)
Manufacturing thrust
(incentivized production
across the value chain)
Standards & specifications
(incl. on battery swapping)
Upskilling workforce
Circular economy /
urban mining
Drivers
of EV
Adoption
1
2
3
4
7
8
9
10
11 25Benchmark of Global Best Practices
Demand side drivers
1. Fiscal incentives – Cover purchase subsidies and tax exemptions (upfront/recurring) for
consumers to enable TCO parity
2. Supporting incentives - Additional benefits such as preferential access to parking/traffic
zones, toll fee waivers etc. exclusively for EVs
3. Financing support - Increased affordability through lucrative financing options (subsidized
rate of interest, etc.)
4. Consumer awareness / education - Activities to educate/engage potential users on EV
benefits, e.g., campaigns, EV related website, etc.
Supply side drivers
5. Manufacturing thrust – Support for EV OEMs & EV component suppliers like capital
subsidies, tax holidays, import restrictions, infrastructure support
6. R&D thrust - Initiatives to boost spends in R&D (e.g., funding industrial and academic
research projects, building consortiums for increased collaborations, etc.)
7. Sales restrictions / emission regulations - ICE sale & emission restrictions, mandatory fleet
electrification targets, etc.
8. Charging infrastructure adoption - Charging stations network planning, subsidies &
support to CPO, regulatory guidelines to drive EV charging adoption
9. Standards & specifications - Standardization guidelines on charging hardware & battery
swapping; achieving interoperability
10. Upskilling workforce - Plugging skillset gap to make EV ready workforce
11. Circular economy / urban mining - Battery recycling policies & ecosystem development,
end of life vehicle regulations
Ecosystem Enablers
1. Fiscal incentives
Direct purchase subsidies and tax incentives (one-time or recurring) are popularly used tools
by several governments to incentivize the purchase of electric vehicles. Several countries in
Europe, China, Japan, Australia, and USA offer varied incentives for the EV consumers.
2.2.1 Demand side drivers
2.2 Global best practices
In the next section, best-in-class practices for government policies and regulations have been
benchmarked across each of these 11 areas. 26Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Exhibit 7: Fiscal incentives across key geographies
Exhibit 8: Phase-out of EV subsidies in China from 2013-2022
€9,000 (if VC < €40K)
€12,000 (if €65K > VC > €40K)
-
Road tax exempt for 10 years
(~€200/year)
€6,000-
Road tax exempt for 5 years
(~€170/year)
€6,000-10,000-
5-year annual tax exempt, post 5
years 75% lower vs ICE
--VAT exempt (~25% of cost)
-£1,500 (if VC < £32,000)
Road tax exempt (vs £145-£335
for ICE)
JPY 800,000
No purchase tax (vs 3-5%
for ICE)
Road tax exempt (vs $75-275 for
ICE); Weight tax (vs $45/ton for ICE)
-RMB 9,000-13,000
No purchase tax (vs 10%
cost for ICE)
AUD 3,000
Stamp duty exempt
(50-100% lower than ICE)
Annual registration fee subsidy
(30-100% lower than ICE)
---
VC: Vehicle cost
It is observed that certain countries have phased-out financial incentives after succeeding in
driving EV adoption. For example, China is one of the earliest countries to introduce EV subsidies
in 2013 with contributions from both national and state governments. Since then, several
phase-out periods have resulted a reduction of subsidies from ~30% in 2013 to ~5% currently
with complete removal expected post 2022. However, EV penetration has witnessed a gradual
increase over the period. The range threshold, set as a qualification factor to avail subsidy, has
also increased over the phase-out period starting from 80km in 2013 to 300km currently.
$2,500–7,500 income tax credit available
GeographySubsidyUpfront tax reduction Recurring tax reduction
Europe
(3)
E-4W
Volume(in Mn)
E-4W
penetration %
<0.1 0.1 0.3 0.5 0.9 1.3 1.4 1.3 1.9
0.1% 0.6% 1.2% 1.9% 3.3% 5.2% 5.8% 6.1% 9.5%
Rapid growth despite phase-out
Subsidy
(% Cost)
~30%~5%
Expected
to be
phased
out entirely
by end of
2022
Total subsidy
In ‘000 RMB
150
100
50
0
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
60
60
57 54 55
57 54 55
22
25
13
25 23 18 13
44 50
-40%
-50%
-20%
-30%
Local Subsidy capped at
50% of national Subsidy
Nationwide
program initiated1st Phase 2nd Phase3rd Phase 4th Phase5th Phase 6th Phase
National
Local
Range
Threshhold
(in km)
80 8080100 100 100 250300300300
1. BYD’s E6 model (RMB 370K before subsidies) considered for 2013; BYD Qin EV300 (RMB 260K before subsidies) considered for 2022
2. Minimum range (set by Finance ministry) to avail subsidy considered here 3. Beijing considered for local govt. subsidy comparison
4. Subsidies vary by range, max. subsidy considered here 5. Phases 1-6 subsidy phase-out through qualification tightening 27Benchmark of Global Best Practices
2. Supporting incentives
Exhibit 9: Multiple mechanisms used to supplement EV incentives packages
Exhibit 10: Ultra-low emission zone created in London restricting the access to polluting vehicles
Supporting incentivesExamples
Access to bus lanes
Free parking
Dedicated parking
areas for EVs in busy
locations
Unrestricted access
(traffic zones/
licensing)
Intermodal
transport benefits
Exemption on toll
road charges
1. 50% reduction of ferry transport for EVs
In addition to fiscal incentives, governments also offer special privileges and perks to EV
owners to influence purchase decision. Some of these mechanisms are highlighted below:
Zones restricting the usage of ICE vehicles have been established in several countries to
promote the usage of electric vehicles. For example, the ultra-low emission zone (ULEZ) in
London was created in 2019 and has been expanded 18 times since then covering ~3.8 million
people. Today, there are ~44,000 lesser ICE cars driven in the zone each day resulting in a
decline of 44% toxic NO
2
emissions, and curtailing emission of ~12,300 tonnes of CO
2
till 2021.
1. Euro 4 (if petrol) or Euro 6 (if diesel) 2. Congestion zone operates around central London in select hours
Ultra-low emission zone in London since 2021
The ULEZ will operate 24 hours a day, 7
days a week throughout the year except
for Christmas
Daily entry charge for ICE passenger
vehicles
1
is €12.50, paid on top of
congestion zone fee
2
of €15
Cameras read vehicle number plates as
they are driven within the zone to check
against the database of registered cars
Ultra-low emission zone (ULEZ) 28Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Several cities and provinces in China have implemented license plate restrictions as a solution
to traffic congestion and boost e-mobility. Licenses were issued either through an auction or a
lottery controlled by individual states. When first launched, the average price of a license plate
in Shanghai costed more than USD 18,000, and there were 200 applicants for each granted
registration in Beijing. With EVs being exempt from the restriction, this created a significant
incentive for consumers to purchase electric vehicles.
Exhibit 11: License plate restriction policies across cities/provinces in China
Beijing
Tianjin
Guiyang
Shanghai
Hangzou
Shenzhen
Hainan
Guangzhou
There is significant
demand for mobility
services in the cities
with plate restriction
As China’s urbanization
continues, more
restrictions on license
plate and use of private
vehicles are expected in
other lower-tier cities in
the coming years
Examples of cities / province who have rolled out plate restriction
(1)
1. Urban city tiers defined based on 2020 middle and affluent class consumer (MAC) population, defined by BCG CCI (Center for
Customer Insight) 2. Owing to the auto sales slump due to Covid, several state-level government agencies, including the National
Development and Reform Commission and the Ministry of Commerce have recommended states to withdraw the restriction;
Guangzhou, Shenzhen, Guiyang, Hainan, Shanghai, Tianjin have either agreed to or already removed or relax the restrictions
3. Financing support
Countries like Scotland, Australia, and Norway have created funds to finance purchase of
electric vehicles, which have been deemed significant by consumers. Initiatives undertaken
include:
• Transport Scotland
(4)
offers interest free loans on new and used vehicles for both personal
and commercial purposes covers all vehicle categories
Tianjin:
Start Date: 2013
Car Parc: 2.87 m
Size: 12K km
Tier 1
Hangzou:
Start Date: 2014
Car Parc: 2.44 m
Size: 17K km
Tier 1
Guangzhou:
Start Date: 2012
Car Parc: 2.4 m
Size: 7K km
Tier 1
Shanghai:
Start Date: 1994
Car Parc: 3.59 m
Size: 6K km
Tier 2
Hainan Province:
Start Date: 2018
Car Parc: 1.16 m
Size: 34K km
Shenzhen:
Start Date: 2014
Car Parc: 3.22 m
Size: 16K km
Tier 1
Guiyang:
Start Date: 2011
Car Parc: 1.81 m
Size: 8K km
Tier 2
Beijing:
Start Date: 2011
Car Parc: 5.64 m
Size: 16K km
Tier 1 29Benchmark of Global Best Practices
Exhibit 12: Interest free EV loans provided by Transport Scotland
Purchase of new EVs for personal use
• up to £28,000 to cover the cost of purchasing a
new pure electric vehicle (cars)
• up to £10,000 to cover the cost of purchasing a
new electric motorcycle or scooter
Purchase of new EVs for commercial use
• Loans up to £28,000 (for cars), £35,000 (for vans),
£10,000 (2W)
• Combined upper cap of £120,000 per business; no
cap per vehicle on purchase of HGVs, coaches,
minibuses, buses
• Businesses eligible if operational for more than
12 months
Purchase of used EVs
• up to £20,000 to cover the cost of purchasing a
used electric car/van
• up to £5,000 to cover the cost of purchasing a
used electric motorcycle or moped
• Cars and vans costing below £20,000 and
motorbikes and mopeds costing below £5,000
eligible for the loan
Switched on Taxi loan
• up to £120,000 to enable owners and operators of
hackney cabs or private hire taxis to replace their
current vehicle with an eligible ultra-low
emission vehicle
% consumers
who considered
these interest
free loans as
crucial decision
driver in
purchase of EV
Total loan
amount
disbursed
(till 2020)
Administrator
for the fund
~64%
£85m
1. Survey by Energy Saving Trust showed 35% consumers believe they wouldn’t have purchased an ULEV, 29% believed they would
have purchased less quickly without these loans 2. Used EV loans added under Low carbon transport loan since 28 September
2020 3. Low Carbon Transport loan does not include Switched on Taxi loan 5. Energy Saving Trust is an independent not-for-profit
organization working to address multiple climate change issues; funded by Transport Scotland to provide zero interest loans to
consumers
• Clean Energy Finance Corporation
(5)
(Australian government - owned Green Bank) partners
with banks to provide subsidized loans on purchase of EV and EVSE – total financing of more
than AUD 300 Mn
»Partnership with 6 private banks with dedicated program to finance EV sales
»More than 5,000 electric vehicles financed at ~70 bps discount
Products covered under the programme 30Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Asset finance program partners
1
Exhibit 13: EV and EVSE financing programs lead by CEFC through multiple asset finance partners
ANZ Energy Efficient Asset
Finance program
ANZ
BOQ
METR
Plenti
Firstmac
Eclipx
Bank of Queensland Energy
Efficient Equipment Finance
Eclipx Group
Metro Green by
Metro Finance
Plenti Green Loan
Firstmac Clean
GreenCar Loan
AUD 250 Mn.
AUD 100 Mn.
AUD 50 Mn.
AUD 50 Mn.
AUD 50 Mn.
Not available publicly
Total
financing
for EV loans
till 2021
70 bps
(~10% of
total interest
outlay)
5,100+
AUD
300
Mn+
Total vehicles
financed
under this
programme
Resultant
discount in ROI
on EV loans for
customers
1. CEFC has 8 partnership programs in asset financing of which 6 involved in green auto loans 2. Funding across energy-efficient
and renewable technologies; allocation for EV loans not available publicly 3. 0.7% deduction in interest rate accounts to ~10%
discount (varies by bank e.g., non-green loans 8.2% @ BOQ, 6% @ Firstmac) 4. All numbers as of 2021
4. Consumer awareness / education
Several governments have launched campaigns to promote EV awareness among consumers.
For example:
• The North-Eastern USA state governments have come together to launch the “Drive
Change. Drive Electric
(6)
.” campaign through a public private partnership with auto
manufacturers. Their mission is to popularize the EV lifestyle through their website and other
social media platforms. They drive awareness through various means such as a video
series of EV lifestyle featuring famous celebrities, testimonials of EV owners and travel guide
of various destinations in North-East USA located on routes with strong EV charging network.
• Similarly, ‘Go Ultra Low
(7)
campaign is a joint initiative of UK government and auto industry
that aims to drive EV adoption in UK. The campaign maintains an informative website that
provides several tools such as charging point map, journey cost calculator, tax savings
calculator, local incentives identifier, energy tariff tool etc. In addition, the website also
contains detailed information on EV models from several auto makers and assists in
booking test drives.
• Some states in the USA have launched EV academic programs to inculcate awareness
of EVs in students. For instance, the University of Michigan
(8)
, in collaboration with the
Department of Energy, local transportation authorities, and auto industry players, has
launched a K-12 summer program to drive awareness on electric vehicles and create
interest in EV related courses for higher education.
• EV experience events are also being organized by governments to further drive awareness
of EVs. The Oregon state govt. funded the EV advocacy group Forth Mobility
(9)
to organize
awareness programs by connecting experts with potential EV consumers for discussing any
concerns related to EVs. While the physical outlet is based out of Portland, the organization
Dedicated program for
EV finance
Total contribution
by CEFC
2
CEFC 31Benchmark of Global Best Practices
1. Forth mobility, erstwhile Drive Oregon, is a state of Oregon funded advocacy group 2. Physical outlet at World trade center,
Portland currently not operational; virtual tour provides an interactive experience for customers
has also launched a virtual tour of their office to reach out to a wider audience. In addition,
a mobile showcase, which is an office on wheels, also organizes several tours across sub-
urban localities to reach out to under-served communities.
Exhibit 14: Forth Mobility offerings to promote EV awareness
5. Manufacturing thrust
2.2.2 Supply side drivers
While many countries have provided ad-hoc / case basis grants, only a few governments have
launched holistic EV supply chain localization campaigns and policies. Examples of recent local
EV supply chain promotion policies are listed below:
• The European Union formed EBA 250 in 2017 to drive localization of entire battery
manufacturing value chain. Capital funding in the form of grants was provided under
IPCEI
(10)
for cell component manufacturing, cell and pack manufacturing. Economic support
of €3.2 Bn for 17 projects was provided under IPCEI 2019 by 7 member states and €2.9 Bn
provided for 46 projects under IPCEI 2021 by 12 member states. Financing support is also
available through the European Investment Bank and European Bank for Reconstruction &
Development.
Wide range of services offered by Forth Mobility
Test drive
scheduling
EV expert calls Car finder tools
Oregon EV byways
information
Function and
charging overview
Mobile showcase
for undeserved
communities
Virtual tour of Forth showcase
Mobile showcase 32Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Exhibit 15: Projects approved under IPCEI 2019 and IPCEI 2021
• 7 Member States
• 17 projects
• 12 Member States
• 46 projects
Total estimated private sector
investment
Total Economic Support
(~40% of total investment)
2021
2019
€3.2B
Total Economic Support
(~40% of total investment)
€2.9B
€8B
Total estimated private sector
investment
€12B
Important Project of common European interest (IPCEI)
BASFACC
BMW
BMW
Endurance
EnduranceEndurance
Elemental
Fortum
EnerisEnerisEneris
KaitersFAAMFAAM
Enel X
SEEL
SEEL
SEEL
VARTA
Umicore
Raw and advanced
materials
Re-purposing,
recycling and refining
Battery
Systems
Cell and
Modules
Alumina Systems
BMW
Cellforce Group
Elring Klinger
FCA
Green Energy Storage
InoBat Auto
Manz
Midac
Northvolt
SGL Carbon
Skeleton Technologies
Sunlight Systems
Tesla
VARTA Micro Innovation
ACIS
Alumina Systems
AVL
BMW
Endurance
Enel X
Energo Aqua
FCA
FIAMM
FPT Induatrial
Green Energy Storage
InoBat Energy
Manz
Miba eMobility
Midac
Rimac Automobil
Rosendahl Nextrom
Skeleton Technologies
Sunlight Systems
Tesla
Valmet Automotive
Voltlabor
Borealis
Enel X
Engitec
FIAMM
Fortum
Hydro metal
Idealmatch Chemicals
Keliber
Liofit
Little Electric Cars
Midac
SGL Carbon
Tesla
Vaimet Automotive
ZTS VaV
Raw and advanced
materials
Re-purposing, recycling
and refining
Battery
Systems
Cell and
Modules
ACS
Arkema
Borealis
Ferroglobe
Hydrometal
Green Energy Storage
Italmatch Chemicals
Tokai Carbon Group
VARTA Micro Innovation
Keliber
Prayon
SGL Carbon
Solvay
BASF
Eneris
Keliber
Nanocyl
Solvay
Terrafame
Umicore 33Benchmark of Global Best Practices
• The US government has announced grants valued at $7 Bn under the Infrastructure
Investment & Jobs Act
(12)
to localize the entire EV value chain from battery RM processing
to EV assembly. Incentives are primarily offered as capital subsidy in the form of
competitive grants under 3 programs – Battery Materials Processing Grant ($3 Bn), Battery
Manufacturing & Recycling Grant ($3 Bn) and Advanced Energy Manufacturing Grant ($750
Mn) aimed at different parts of the value chain including cell component manufacturing,
cell manufacturing, battery assembly, other EV components, and EV assembly. Applications
for the respective grants are expected to be opened in Q3 2022.
Exhibit 16: Incentives for EV and EV components manufacturing in USA
Nature of
incentive
Incentives
under
scheme
Criteria
Battery Materials
Processing Grant
Battery Manufacturing
& Recycling Grant
Advanced Energy
Manufacturing Grant
Capital subsidy (grants) Capital subsidy (grants)Capital subsidy (grants)
• Eligible – States, local governments, institutions of
higher education, non-profit & for-profit private
entities, national laboratories
• Beneficiary to match 50% of total project cost
• Eligible –
Businesses with
<$100 million
gross annual
sales, <500
employees,
annual energy bill
$0.1-2.5 million
• $3 billion funding
(up to 50% of total
cost of project) to
support demonstration
projects & construction
of facilities for RM
processing, battery
component & battery
module manufacturing
• $600 million
appropriated annually
from 2022-2026
• $3 billion funding (up
to 50% of total cost
of project) to support
demonstration projects
& construction of
facilities for battery &
battery component
manufacturing &
recycling
• $750 million
funding for
manufacturing of
Advanced Energy
products/services–
includes all types
of EVs and related
technologies,
EV components,
charging
& refueling
infrastructure
Program Objective: Support EV deployment in the country, localize battery manufacturing across the value
chain & boost domestic production of ZEVs
$3Bn$3Bn$3Bn 34Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Toray: €47M
(12% of total
investment)
subsidy for
manufacturing
Li-ion battery
separator films
LG Chem: €93 Mn (9% of total
investment) subsidy along with
subsidized land, tax exemptions & €480
Mn loan agreement from EIB for battery
cell, module, packs manufacturing
Diamler: €42.2
Mn (30% of total
investment)
grant to add EV
production line
existing plant
Umicore: €125
million loan(€370
million total cost)
by EIB for cathode
production facility
Farasis: Direct subsidy up to 50% of
equipment cost, free land, 100% refund
for CIT & VAT for 5 years and power
subsidy for battery cell, module & pack
manufacturing
Tesla: Low
interest loans
(3-year $465
Mn); $106 Mn tax
break from state
of California
Elkem: NOK 10 Mn
grant from Enova,
€40 Mn loan from
NIB to produce
natural graphite
AAM
Tesla: 980 acres free land, tax abatement
up to 20 years, discounted electricity
rates for Nevada Gigafactory
BAIC: $346 Mn
subsidies through
central and local
fiscal funds for
manufacture of
100,000+ E-series
vehicles
Solus Advanced
Materials: Tax
cuts worth
€11Mn for ultra-
thin copper foil
production along
with $28Mn long-
term loan
from EBRD
Freyr: Grant
of NOK 142 Mn
from ministry
of climate and
environment
for battery cell
production
SK Innovation:
€90 Mn (10% of
total investment)
subsidy
for battery
manufacturing
factory
Nio: 7 Bn Yuan
for 24% share
of JV with JAC
(state owned
auto OEM); JAC to
build final EVs in
Hefei, will be paid
on a per-vehicle
basis
Exhibit 17: Select examples of ad-hoc incentives provided for EV and EV components
manufacturing
Cell ComponentEV Vehicle AssemblyBattery (module / pack)Cell manufacturing
In addition to above comprehensive policies, USA, China and countries across Europe have
also given incentives on case to case basis to different companies to set up capacity for EV
value chain manufacturing. The type of incentives offered include provision of land and/or
infrastructure, capital subsidies, financing support, fiscal incentives, and subsidized utilities.
Select examples of such projects are listed in the below exhibit. 35Benchmark of Global Best Practices
6. R&D thrust
EU
(15)
has provided significant R&D thrust by establishing a centrally coordinated program
to drive collaborative, large-scale R&D efforts to create battery market worth €250Bn p.a by
2025
(18)
. Under the umbrella of EBA250, Batteries Europe has been established
(14)
to elaborate
the strategic R&I agenda and technology roadmap for batteries, encompassing all technology
readiness levels (TRLs) and stages of the value chain. Horizon Europe
(19)
, EU’s key funding
program for R&I, committed a €95B+ funding till 2027 for sustainable mobility and clean energy
R&I, including €1.4B+ funding for battery R&I programs. The most important battery projects
funded by Horizon Europe include:
• Battery 2030+
(17)
is EU’s large-scale, long-term research initiative tasked with inventing
batteries of the future (for e.g., self-healing batteries). It essentially focuses on low TRLs
and identifying disruptive technologies. The initiative has a dedicated budget worth €42M
from Horizon Europe, across 7 Battery 2030+ projects. The vision of Battery 2030+ is to invent
sustainable batteries of the future, providing European industry with disruptive technologies
and a competitive edge across the full value chain.
• BATT4EU
(16) (32)
, a public-private partnership, was set up to focus on the most urgent R&I
priorities across the European battery value chain – incremental innovations in existing
battery technology (e.g., 60% improvement in energy density, 2x cycle lifetime). The
partnership comprises 181 members and 18 topics of discussion, funding support worth
€925M from Horizon Europe, and a vision to establish, by 2030, the best-in-class innovation
ecosystem to boost a competitive, sustainable and circular European battery value chain.
€6.1B
(10)
for R&I and
localization across the
battery value chain
EU’s dedicated R&I
funding program
• 700+ members
(18)
• Industrial, financial,
academic, and
public stakeholders
• Goal of creating
competitive &
sustainable battery
cell manufacturing
value chain
• Batteries R&I
strategies and
technology
roadmaps
(14)

• Coordination of
battery initiatives
• Drive forward SET-
plan actions on
batteries
• A network of research
institution and industry
• Focus on lower TRLs,
disruptive tools and
battery technologies
• Coordination of European
R&I projects implementing
the Battery 2030+
roadmap
(17)
• Public-private partnership
that aims to achieve
a competitive and
sustainable European
industrial value-chain for
e-mobility and stationary
applications
(16)
European
Commission
Exhibit 18: Multiple mechanisms used to supplement EV incentive packages
Note: SET plan: Strategic Energy Technology Plan, R&I: Research & Innovation
IPCEI
BATTERIES EUROPE
EUROPEAN
BATTERY
ALLIANCE
EBA250
European technology and
Innovation platform
Horizon Europe
Battery
2030+
BATT4EU 36Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
7. Sales restrictions / emission regulations
2.2.3 Ecosystem enablers
Some countries have also taken aggressive regulatory stance by tightening emission norms to
drive OEMs to electrify their fleets or announcing targets for national ban on ICE vehicle sales.
Some of these exemplars are highlighted below:
• Stringent policies have been implemented by the EU
(20)(21)
, China, and the US to regulate
the CO
2
emissions. In European Union, OEMs are penalized €95 for every g/km of excess
emissions per vehicle. With emission targets becoming even more stringent over the next
decade, OEMs in Europe are accelerating the roll out of electric vehicles. Similarly, in China,
stricter emission standard (China VI) and dual credit program
(22)
are driving rapid EV
penetration growth (EV target % requirement has increased from 8% in 2018 to 16% in 2022;
expected to be 27% by 2025).
Raw
Materials
Advanced
Materials
Cells
Modules
and packs
Application
Integration
End-of-life
AREA 1
Raw Materials and
Recycling
AREA 2
Advanced materials
and Manufacturing
AREA 3
Battery end-uses
and operations
AREA 6

Coordination
AREA 4
Safety and Reliability
AREA 5
Sustainability
OO4: Reduce battery
cost - 60%
OO6: Implement BAT
in manufacturing
and recycling
operations (plants
4.0 or 5.0)
OO7: Improve
sustainability
and circularity
OO5: Ensure battery safety
OO7: Improve sustainability and circularity
OO1: Increase energy density
+60%
OO2: Increase power density
and charging rate (charging
time <20’)
OO3: Improve cycle lifetime > 2x
OO4: Reduce battery cost - 60%
OO6: Implement BAT in
manufacturing and recycling
operations (plants 4.0 or 5.0)
SO2: Develop sustainable
and affordable solutions
for
clean mobility
SO3: Enable a cost-
effective integration
of renewable energy
sources in the power grid
OO1: Increase energy
density +60%
OO2: Increase power
density and charging
rate (charging time <20’)
OO3: Improve cycle
lifetime > 2x
Exhibit 19: Key R&I areas of BATT4EU
SO – Specific Objective, OO – Operational Objective, BAT – Best Available Technology
SO1: Provide the European industry with differentiating
technologies, supporting the development of an
innovative, competitive and sustainable battery
manufacturing industry in Europe 37Benchmark of Global Best Practices
Exhibit 20: CO
2
emission targets for Europe set by the European Parliament and the Council of
the European Union
Exhibit 21: ICE vehicle sales ban timelines across countries
1. Each OEM has its own 2021 emissions target based on average vehicle mass
Historical
reduction
rate with
standards:
-1.2%/year
2000-2007
Historical
reduction
rate with
standards:
-2.9%/year
2007-2016
Required
-5% CAGR
Required
-19%
CAGR
150
100
0
2000 2005 2010 2015 2020 2025 2030
Example OEM
2021 targets:
• Daimler (103)
• BMW (101)
• VW (96)
• Ford (95)
• Hyundai (94)
• RN (93)
• FCA (91)
JLR
Daimler
BMW Group
Hyundai
VW group,
FCA
Ford
Renault
Group
151
127
122
118
116
115
112 (EU avg.)
106
95
(Target)
Average CO
2
emission
values (gm/km, NEDC)
Implications
Expected avg. 2021 fleet
emissions (gms CO
2
/Km)
OEMs
expected
to pay
$29Bn in
fines or
as much
as ~€1.7k/
vehicle
(€95 for
every
gm/km
of excess
emissions
per
vehicle)
Historical dataDaimlerHyundaiFordBMWVW RN FCA
• Several countries across the world have announced national bans on sale of ICE vehicles
(23)
.
Europe is leading the ICE phase-out with several countries banning the sales of fossil-fuel
based vehicles in the upcoming decade (Norway from 2025; Iceland, Netherlands, Ireland,
Sweden from 2030; UK, Denmark from 2035; France, Spain from 2040).
Canada
2040
California
(US) 2035
Costa
Rica
2050
Ireland
2030
France 2040
Spain
2040
Cape
Verde
2035
Iceland
2030
United Kingdom 2035
Norway 2025
Sweden 2030
Denmark 2035
Netherlands 2030
Germany 2050
Slovenia 2030
Target to allow sale or registration of new
BEVs, FCEVs, and PHEVs only
Target to allow sale or registration of
new BEVs and FCEVs only
1. Only includes countries permitting sales of BEVs, FCEVs, PHEVs. Germany considering ICE ban from 2035, currently part of
International Zero emission vehicle alliance pledging ban by 2050 38Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
• There are several other national/local governments that are mandating electrification of
fleets / public transport in the upcoming decade (e.g., California has mandated 90% fleet
electrification for ride-hailing players by 2030; Shenzen has already transitioned to 100%
electric buses)
(24)
.
Exhibit 22: Fleet electrification targets for state-owned vehicles across countries
100% electric bus fleet for public
transport (achieved)
Shenzen Govt.
Govt. of Amsterdam
Govt. of California
Govt. of California
2020
100% electric buses in city center2022
Emission free buses only to be
procured
C40 cities (97 cities representing
1/12th global population)
1
USA state govts. (California,
New York, Washington)
2025
90% of all ride-hailing services’
miles to be electrified
2030
All taxis and private hire
vehicles to be zero emission
2033
2037
2035
Bus fleets to be electrified
100% government vehicles to
be electrified
EntityCountryYearTarget
8. Charging infrastructure adoption
Charging infrastructure has been given a significant boost in countries like China, Netherlands,
and Germany. Respective governments in all 3 countries have issued several policies to
support charging infrastructure deployment at an accelerated pace including a national
masterplan, guidelines for subsidies and supporting ecosystem to enable public private
partnerships. Highlighted below are the key policies and regulations in each of these countries:
• China followed a public-led model for installation, ownership & operation of charging
stations through the State Grid during inception phase. In 2015, China developed a national
charging infrastructure masterplan outlining city tier-wise targets for the next 5 years,
fast vs. slow charging split, and total investment of RMB 150B by 4 ministries. Capital
subsidies on equipment, land and installation cost were provided to attract private sector
investment (e.g., 30% subsidy provided in Beijing) and scale up deployment of charging
stations across the country to support EV adoption
.(25)
In addition to this, grid upgrades
were also mandated as responsibility of the grid operator by the state. The Electric Vehicle
Charging Infrastructure Promotion Alliance (ECVIPA) was also formed in 2015 to give policy
recommendations related to charging infrastructure in China. The body comprised of
representatives from all stakeholders – EV OEMs, grid operators, EVSE manufacturers, CPOs
and MSPs along with the relevant ministries.
• In Netherlands, similar to China, charging infrastructure deployment was public led in the
inception phase through the ELAAD foundation comprising of 6 state-owned grid operators.
Scale up happened through large scale transfer of ownership to private players. Formation
of a public-private platform, known as the Formula E Team, by the Ministry of infrastructure
in 2009 encouraged dialogue between all stakeholders and helped build trust in the
ecosystem in the initial phase. In 2011, the government released the E-Mobility action plan
setting national level targets for 2015 and 2020 along with announcing financial support
to attract private investment. To improve business case for private sector, both capex and
opex subsidies were provided.
1. Pledge taken by state governments as part of Net zero carbon 2040 pledge by ‘The Climate Group’ 39Benchmark of Global Best Practices
Exhibit 23: Public land used as lever to improve business case for private sector in Netherlands
• Reduced cost of
operations, improving
business model
• Hassle free
procurement of land
for installation
Typical Operating Costs for an EV charging station
Offered by
Municipality
for free
Electricity
Cost
Land
Rent
O&M SG&A Total OpEx
Savings by government
concession
Typical
operating
cost of
charging
station
Operating costs Savings through concessions
Benefits to CPOs
• On the other hand, in Germany, initially charging infrastructure development was private
led. Subsidies during this period were distributed without sufficient guidelines and
conditions leading to insufficient and sub-optimal charging network with underutilized
and commercially unviable stations. 2015 onward, the German government has taken a
more programmatic approach with public-led charging infrastructure deployment. The
new approach is based on 3 parts – a national masterplan with clear targets for charging
infrastructure, public-led ownership and financing, and targeted subsidies program with
clear guidelines.
Capital Costs Savings through grid operator support
Benefits to
Municipalities
Exhibit 24: Grid connection and installation support offered in Netherlands
Benefits to CPOs
• Reduced capital costs
• Hassle free installations
of charging stations
with already licensed
and contracted service
providers of the grid
operators
Benefits to
Municipalities
• Encourage investment and
reinvestment from private
sector
• Increased grid reliance
and reliability despite
increased pressure on grid
100% financed
by grid operator
Subsidized against
market rates by
grid operator
Relief offered by grid
operator – (20-30%
of total capex)
Typical
capital cost
of charging
station
Charging
Stations
(Equipment)
Grid Connection
& Ancilliary Infra
(Equipment &
Installation)
Charging
Stations
(Installation)
Total
Capex
Installation of all primary
and charging infra is
done together by grid
operator contracted
installation service
providers, with favorable
pre-negotiated rates
passed onto CPOs for the
charging stations
• Less strain on treasury
as compared to
direct capex/opex
compensation
• Complete control on
location of charging
stations adhering to
needs of city/consumers 40Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Exhibit 25: Public-led approach to accelerate deployment of charging stations in Germany
1
Top-down approach through a national masterplan helped to guide
deployment
Clear targets
for deployment
Defines support
measures
Clarify regulatory
framework
2
Taking ownership of public charging infrastructure allowed public sector
greater control over deployment of EV charging stations
3
Having a well-defined
masterplan with
deployment that target
specific and known
charging needs can
help communicate
commitment by the
government and provide
visibility and confidence
to both the private sector
and the consumers
Provision of subsidies
for charging stations
that are paired with the
supporting guidelines
and conditions (e.g.
interoperability
requirements, obligation
to submit biannual
reports during service
life of charging stations)
can help ensure subsidies
achieve the desired
impact
Key Takeaways
1Awards 5-year contract to consortium through competitive tender
2Consortium deploys charging stations based on govt requirements
3Govt finances and owns assets, and is responsible for any major capex
4Newmotion issues charge card for access to all stations
CPO
Consortium
ConsumerPublic Charging Stations
Berlin
Government2
3
4
1
NEWMOTION
ALLEGOALLIANDER
Programmatic and targeted approach to subsidies helped in driving
effectiveness
9. Standards and specifications
Different governments have taken different approaches to standardize EVSE hardware and
drive interoperability between charging stations for consumers. While some governments
have issued mandates, others have tried to maintain control through tender guidelines and
requirements. Details on standards issued by select countries have been highlighted below:
• Six funding calls from 2016/17 to 2020 were executed , guided by
“Funding Guidelines for EV Charging Infrastructure in Germany”
• Each funding call of subsidies were targeted to focus on different
needs (e.g. areas with high demand)
• Conditions for subsidies were clearly defined (e.g., charging station
availability on all days, use of plug types, interoperability)
Exhibit 26: EVSE standards and guidelines across countries
EVSE Stan-
dardization
Interop-
erability
(Network)
NetherlandsGermanyUSAChinaUK
No standard
defined
Interoperability
initially achieved
through Source
London (publicly
owned), but
declined after
privatization
Govt mandated;
EV OEMs & EVSE
players to adopt
national standard
Only stations on
subscribed CPO
network available
to consumers.
Govt now
pushing for
inter-connected
platform among
CPOs
Multilateral
agreements
between private
players (CPOs
& OEMs) to
facilitate roaming.
No government
intervention yet
Consortium for
public charging
infra provides
charge card to
access all public
EV charging
stations
MSPs provide
charge card
which allows
charging at any
CPO. Enabled by
backend system
that settles dues
between the
CPOs and grid
operators.
Utilities, CPOs
ensure availability
of all plugs; no
regulation
Minimum technical
req. specified in
circular for public
charging stations
Plug type
standards driven
through tender
requirements
Low Medium High 41Benchmark of Global Best Practices
In Netherlands, the government has mandated roaming as a requirement for CPOs and
facilitated the development of a back-end system for communication between MSPs to ensure
seamless interoperability. Consumers with government approved charging cards have the
convenience to charge at any charging station in the country.
(27)
Exhibit 27: Interoperability of charging infrastructure in Netherlands
Consumer with a government approved charging
card has convenience to charge at any charging
station in country
A backend system facilitates adjustment with
CPOs and grid for transactions that are not with
contracted customers
MSP App on
Smartphone informing
location of closest
charging station
Consumer
Consumer with charging
card and contract with
VATTENFALL
Consumer routed to Engie
station despite having
contract with Vatenfall
since it is closer
Consumer billed by Vatenfall
despite procuring charging
services from Engie
10km from consumer
current location
VATTENFALL CPO
1km from consumer
current location
CPO
ENGIE
Backend service provider
facilitates settlement between
CPOs & grid operator
In addition to charging stations, guidelines have also been issued for standardization of
battery swapping stations by select countries. Taiwan is one of the few countries where battery
swapping solutions have been able to ac hieve scale. Government policies have focused
on making battery swapping a viable solution right from the early stages in 2011 through
standardization and capital subsidies.
Exhibit 28: Battery swapping policies in Taiwan
Standardization
Ecosystem
development
Hardware
Software
Enforcement
mechanism
Incentive for
BSS operators
Safety
• Battery specifications: 48V nominal voltage, weight <10kg,
dimensions – 270x95x160 mm, capacity – 10Ah
• Connector: 4 power pins (30A/pin), 6 signal pins (2A/pin)
• Necessary for models with swappable battery to
adhere to above standards to be eligible for purchase
subsidy offered by EPA
• Offered 200,000 NTD construction subsidy to Gogoro.
300 GoStations fully funded & subsidized by CPC
(national oil company)
• Currently, offers 300,000 NTD or 49% installation cost
as subsidy
• Protocol interface: CAN bus protocol 2.0
• Battery safety standards: CNS15387, CNS15424-1
Policy focus Focus areaDetails 42Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
10. Upskilling workforce
European Union has launched following key initiatives to upskill or reskill its workforce to
transition the automotive industry to electric vehicles:
• EU’s ALBATTS
(30)
is a collaboration across 20+ organizations and 11+ EU countries to develop
a blueprint for education and training for the battery production sector (conduct skill-gap
assessment, identify skills of the future and curate relevant L&D modules)
Exhibit 29: EU’s ALBATTS is working towards mapping current state of technology and syncing
new skills demand with supply of education and training in battery sector
Vision:   To make Europe a competitive player in the battery ecosystem, by empowering
European industry with a high-skilled workforce and expertise in batteries development
and production.
Key thrust areasSelect examples of programs underway
• Brings together 20
organizations from
11 EU countries
• To promote
cooperation
between all
stakeholders in
the battery and
electromobility
value-chain, to
develop a blueprint
for education and
training for the
battery production
sector
Sectoral Intelligence
• Monitor
developments in the
battery sector
Sectoral skills strategy
• Recommendations
to assure efficient
education and
training in emerging
battery sector
Education and Training
• Detailed curricula,
training materials
and pilot training
courses
Dissemination
measures
• Promotion of the
project’s activities
towards supporting
of the skills agenda
• Fostering partnerships
with industry players to
identify battery skills of the
future, for e.g., ALBATTS
2
in
collaboration with Northvolt
has identified job roles & skills
for battery manufacturing and
competencies required now vs.
in the future
• MOOC
1
2020: ALBATTS
2
and
DRIVES
3
jointly launched
a platform to reskill and
upskill workforce in the
Automotive sector through
home education. Sample
courses below:
»Energy Storage –
understanding the battery
revolution
»Battery Manufacturing:
Trends in Battery Engineering
»Innovation Strategies
for Electric Mobility: The
StreetScooter Case
ALBATTS
€3M
EU funding
1. Massive Open Online Course 2. The Alliance for Batteries Technology, Training and Skills 3. Development & Research on
Innovative Vocational Education Skills
• European Battery Academy
(31)
set up, with €10M+ funding, to provide a comprehensive
learning service offering, convening the knowledge of industry and academia from
18 countries to upskill local workforce. The European Battery Academy woks in close
coordination with EBA250 members to identify key skills needed across the value chain. 43Benchmark of Global Best Practices
Exhibit 30: New EBA Academy launched to boost skills for battery ecosystem in Europe
Key thrust areas
• Based on
continuous
input and
feedback from
European
projects (e.g
ALBATTS, Battery
2030+, etc) the
urgent need for
skills is identified
• 30 modular
learning
packages,
based on real-
world scenarios,
launched to
bridge the
growing skill-gap
€10M
EU funding
Vision: To provide an education and training ecosystem for businesses, convening the
knowledge and experience of researchers, entrepreneurs, businesses, thought leaders, and
key players from 18 different countries into a single, comprehensive learning service offering
Endeavor to upskill 8,00,000
workers by 2025
• Spain and France have
already signed up to train
up to 150,000 workers
each under EBA Academy
training programme
• Hungary is looking to up-
skill up to 40,000 workers
with the help of the
Academy
Awareness
• Understanding battery
storage
• Energy Systems Integration:
an intro
Discovery
• Battery bash (AR)
• Battery workbench (VR)
• Battery storage
opportunities & uses
Basic
• Battery storage & smart grid
applications
• Fundamentals on batteries
Advanced
• Battery management
systems
• Managing Energy Analytics
• Materials to electrodes,
Electrodes to cells
Expert
• Solid-state batteries
• Master in Energy Storage
Not exhaustive
11. Circular economy / urban mining
EU’s new proposal
(23)
for Waste Battery Regulations (expected to go live by end of this year)
increases OEM responsibility and introduces guidelines and targets on battery/ELV recycling
and recovery. The initiatives are briefly discussed in Exhibit 30 (next page). The proposal
covers 4 key areas - cell tracking mechanism, battery management system, recycled content
requirement, and recovery and recycling efficiency.
China also has strong policies around the treatment of end-of-life batteries. OEMs have the
responsibility to collect the used batteries. Traceability of batteries and cells is ensured through
encoding and tracing via national database (as per National Standard Coding Regulation
for Automotive Traction) that enables tracking at the cell level. Battery design circularity is
mandatory for the battery manufacturers in order to improve the scalability of recycling
process. Target recovery rates are set for different battery components - 98% for Nickel, Cobalt,
Manganese, 85% for Lithium to ensure high efficiency. 44Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
OEM responsibilities
Cell tracking
mechanism
Battery mgmt.
system
Recycled
content
requirements
Recovery and
recycling
efficiency
• Accuracy and
completeness of data
to be ensured
• Updation of battery
status in case of
repair or repurposing
• Collection of required
parameters by BMS to
be ensured
• Interface for third
parties to access
relevant parameters
to be created
• Documentation of
recycled content of
active materials to be
ensured
• Targets on recycled
content to be
met post 2030 for
batteries that are
either purchased or
manufactured
• Batteries to be
designed to ensure
recyclability
• Recycling targets
to be met through
collaboration with
suitable recyclers
• Unique QR code to be created (acting
as a passport) that records key battery
characteristics such as manufacturing date,
battery composition, expected lifetime, etc. in a
centralized data system to ensure traceability
throughout battery life cycle
• Centralized data system accessible by third
parties to be set up by European Commission
• Regulation effective by 01/2026, implementation
acts by 12/2024
• (BMS) to be included with data on relevant
parameters for determining state of health
and expected lifetime
• Access to data provided to purchaser of
battery and any third party acting on their
behalf to assess residual value, capability
for future use, facilitate reuse, repurpose or
remanufacturing
• Usage of recycled content (material
recovered from waste) of Co, Li, Ni in the
batteries to be reported from 1/2027
• Recycled content targets set for Co, Li, Ni
from 1/2030; targets to get stringent from
1/2035;
• Recycling efficiency targets for Li-ion
batteries set to 65% of average battery
weight from 1/2025 and 70% of average
battery weight from 1/2030
• Target recovery rates at material level
set from 2026; targets to get stringent
post 2030
Proposed regulations and timelinesKey Area
2030
12%
20%
4%4%
12%
2035
Recycled content targets:
Cobalt
1/2026:90%
1/2030:95%
1/2026:35%
1/2030:70%
1/2026:90%
1/2030:95%
1/2026:90%
1/2030:95%
Cobalt Lithium
Lithium
NickelCopper
Nickel
Exhibit 31: EU’s proposal for Waste Battery Regulations 45Benchmark of Global Best Practices
Conclusion
To drive adoption of EVs, globally governments have taken a holistic approach in building
policies & regulations across demand & supply side drivers along with focus on ecosystem
enablers.
For example, across Europe there are several examples of targeted policies across each of
these levers to accelerate adoption of EVs. To stimulate demand, European countries offer both
direct purchase subsidies and tax exemptions, supported by other incentives like preferential
access to bus lanes, free parking, etc. and availability of lucrative financing options (e.g., low-
interest loans) for EV and EVSE projects. They have also launched several campaigns to raise
consumer awareness, e.g., `Go Ultra Low’ campaign in UK.
To support this growing demand, the European Union has also put in place several
mechanisms to boost the local supply chain. EBA250 has been created with the objective of
localizing the entire battery supply chain - from raw materials to final EV assembly. Incentives
for manufacturing are offered in the form of capital grants through IPCEI and financing support
from EIB, EBRD. They have also established a strong R&D thrust through centrally coordinated
programs like Batteries Europe and Horizon Europe covering both strategic agenda for R&I and
funding mechanisms.
Along with demand and supply side levers, governments in Europe have also focused on
building ecosystem enablers by imposing ICE sale restriction targets and tighter emission
norms for OEMs to drive portfolio electrification. Emphasis has also been laid on the
development of a widespread public charging infrastructure through building national
network masterplan, fostering public-private partnerships, and providing subsidies for charger
installation. Governments in countries like Germany and Netherlands have also set mandates
to facilitate standardization and interoperability between charging stations. In addition to
this, EU is also actively working on upskilling the workforce through centrally co-ordinated
initiatives like ALBATTS and EBA Academy as highlighted earlier. To round this up, Waste Battery
Regulations are also currently in the proposal stage aimed at creating a circular economy for
EVs.
As evident from above, it is essential to develop policies & regulations covering the entire EV
ecosystem to boost adoption. In the next section, the current policy landscape in India for
the manufacturing drivers has been covered, followed by a comprehensive deep dive of the
entire EV value chain to identify areas where additional government thrust is required to further
develop the local supply chain.
References
3. Wallbox, https://blog.wallbox.com/ev-incentives-europe-guide/
4. Energy Saving Trust, https://energysavingtrust.org.uk/
5. Clean Energy Finance Corporation, https://www.cefc.com.au/
6. Drive Change. Drive Electric., https://driveelectricus.com/
7. Go Ultra Low. https://www.goultralow.com/
8. Transportation Electrification Education Partnership for Green Jobs and Sustainable Mobility. Department of Energy, USA. Grant:
DEEE0002119. https://www.osti.gov/servlets/purl/1132611
9. Forth Mobility. https://forthmobility.org/
10. https://www.ipcei-batteries.eu/
11. https://ec.europa.eu/commission/presscorner/detail/en/ip_19_6705
12. https://www.whitehouse.gov/wp-content/uploads/2022/01/BUILDING-A-BETTER-AMERICA_FINAL.pdf
13. https://ec.europa.eu/info/index_en
14. https://www.innoenergy.com/
15. https://energy.ec.europa.eu/
16. https://bepassociation.eu/
17. https://battery2030.eu/
18. https://www.eba250.com/ 46Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
19. https://ec.europa.eu/info/research-and-innovation/funding/funding-opportunities/funding-programmes-and-open-calls/
horizon-2020_en
20. ICCT CO2 emission standards for passenger cars and Light commercial vehicles in the EU (Jan 2019). https:// theicct.org/sites/
default/files/publications/EU-LCV-CO2-2030_ICCTupdate_201901.pdf
21. ICCT CO2 emissions from new passenger cars in the European Union: Car manufacturers’ performance in 2018 (August 2019).
https://theicct.org/publication/co2-emissions-from-new-passenger-cars-in-the-european-union-car-manufacturers-
performance-in-2018/
22. How will the dual-credit policy help China boost new energy vehicle growth? (Feb 2022). https://theicct.org/ china-dual-
credit-policy-feb22/
23. Update on government targets for phasing out new sales of internal combustion engine passenger cars (June 2021) https://
theicct.org/publication/update-on-government-targets-for-phasing-out-new-sales-of-internal-combustion-engine-
passenger-cars/The Climate Group. https://www.theclimategroup.org
24. The Climate Group. https://www.theclimategroup.org
25. https://theicct.org/sites/default/files/publications/China-green-future-ev-jan2021.pdf
26. https://blog.wallbox.com/ev-incentives-germany/#:~:text=The%20subsidy%20covers%20up%20to,for%20 medium%20
voltage%20grid%20connections.
27. https://nederlandelektrisch.nl/u/files/2018-11-ev-charging.pdf
28. https://meet-global.bnext.com.tw/articles/view/47488
29. https://www.electrive.com/2022/01/18/battery-swapping-stations-to-overtake-petrol-pumps-for-taiwan/
30. https://www.project-albatts.eu/en/home
31. https://www.eba250.com/eba-academy/about-eba-academy/
32. BATT4EU’s “Strategic Research & Innovation Agenda”, September 2021
33. Directive 2006/66/EC of the European Parliament and of the council of 6 September 2006 on batteries and accumulators and
waste batteries and accumulators and repealing Directive 91/157/EEC
34. Proposal for a regulation of the European Parliament and of the council concerning batteries and waste batteries, repealing
Directive 2006/66/EC and amending Regulation (EU) No 2019/1020 47Benchmark of Global Best Practices 48Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
03
Assessment of EV
Supply Chain 49Overview of EV Adoption in India 50Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
3.1 The EV value chain
The electric mobility value chain includes the battery pack, consisting of cell components,
cell manufacturing and battery assembly; other EV specific components like e-motor, power
electronics, etc., and traditional auto components. EV specific components form bulk of the
cost of the EV – around 55-65% out of which the battery pack is the highest cost component
comprising 35-40% of total bill of materials. Traditional auto components form the remaining
35-45%. The value chain further consists of assembly of EVs by OEMs and the set-up of
supporting charging infrastructure.
Exhibit 32: Electric mobility value chain
The following components have been considered under each part of the value chain:
1. Cell component manufacturing- Cathode Raw Materials (E.g., lithium, nickel, cobalt,
manganese), Cathode Active Mix, Aluminum Foil, Carbon Powder, Copper Foil, Graphite,
Electrolyte, Separators and Other Consumables (E.g., Packaging Foil, Binder, Tape, Glue, etc.)
2. Cell manufacturing- Assembly of cell components to form a cell
3. Battery module and pack assembly- Sensors, Battery Management System, Thermal
Management System, Module Casing, Interconnects & Circuit Protection, High Voltage
Electric Cables, Pack Housing
4. Other EV specific components- E-motor drive (e-motor & transmission), Power electronics
(motor controller, onboard charger, dc-dc converter, power distribution unit, vehicle control
unit), EV electricals
5. Traditional auto components- Components common to EV and ICE cars, e.g., chassis/body,
electronic control units, etc.
6. EV assembly by OEMs- Final assembly of electric vehicles for 3W, 4W, LCV and Buses
7. Charging infrastructure- AC and DC charging infrastructure equipment (EVSE) for all
vehicle categories
Illustrative for a 4W with 30kWH battery pack, 96 kW PMSM drive
35-40%
% EV BOM
Other EV specific components(e.g.,
e-motor, power electronics)
Traditional auto components
Charging
infrastructure
EV assembly
by OEMs
20-25%
35-45%
Cell component
manufacturing
Cell
manufacturing
Battery
assembly
Battery pack 51Assessment of EV Supply Chain
3.2 Impact of current government
initiatives
The Government of India has launched multiple initiatives of late to drive localization of
the EV value chain. From the different PLI schemes to localization mandates via the Phased
Manufacturing Programs, significant steps have been taken in this direction. Many state
governments have also come up with EV manufacturing promotion policies to enable setup
of local EV supply chain footprint.
Exhibit 33: Current policies targeting EV supply chain localization
ACC PLI
(36)(37)
Auto PLI
(38)
Large Scale
Electronics
Mfg. PLI
(39)(2)
Semiconductor
& Display Fab
PLI
(40)(2)
State-level
incentive
programs
(41)
PMP program
(xEV
components)
(42)
PMP program
for (EVSE
components)
(43)
Auto
Component
PLI
(38)
• Announced in 2021
• Bidding completed,
4 players selected
• Announced in 2021
• 20 players approved
across vehicle
segments
• Announced in 2021
• Bidding completed,
75 players selected
• Announced in 2020
• 1st round results
declared
• 2nd round bidding
opened
• Announced in 2021
• Bidding completed;
results to be
announced
• Varying incentives
available across 13
states
• Announced in 2019
• Deadlines extended
in Oct’21
• Announced in
November 2021
• 50GWh capacity to be set
up by 2026/27
• INR 18.1k crore incentives by
govt.; 60% domestic value
add criteria within 5 years
• Budgetary outlay ~INR 26k
crore
• Proposed investment of
INR 45k crore by approved
players (only by EV OEMs)
• 50% domestic value
addition criteria
• INR 11k Cr investment
committed in 1st round by
20 companies
• 30 companies to be
chosen in Round 2
• INR 76k crore
comprehensive program
• 20 companies have
submitted EOIs
• 16 key EV components
targeted to be localized
by Apr’22
• 12 key EVSE components
targeted to be localized
by Jan’23
PolicyImplementation stageKey elements
Targeted value
chain segment
Financial incentives
Localization
mandates
1. Eligibility criteria for FAME 2 subsidy
2. Certain electronic components like semi-conductors are
used to produce key battery sub-components like BMS
Cell component mfg.Battery assemblyCell mfg.
Other EV specific components
EV
assembly
Traditional auto components
Charging
infra 52Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
These initiatives have resulted in varied starting positions across the EV value chain. Current
policies are expected to bring high localization in some set of components while additional
thrust will be needed to drive further localization of other parts of the value chain
Based on the above analysis, 7 areas have been prioritized for benchmarking. An in-depth
supply chain benchmarking has been carried out for each of these 7 areas, at a sub-
component/category level.
High localization expected
Additional thrust required
1. Cell manufacturing - ACC PLI is expected to achieve 50GWh of Li-ion cell capacity in next
4-5 years, in line with current policy measures.
2. Traditional auto components – Many components are already localized at scale in
India. Assembly for components which are not already localized is covered under Auto
Component PLI.
3. EV assembly- This segment is already localized at scale in India for 2W, with the current
policies ensuring an INR 45k crore investment proposed for Auto PLI.
4. Other EV specific components- Existing policies such as Auto Component PLI (covering
motors, motor controllers, high voltage harnesses and connectors, power electronics,
onboard chargers, etc) and PMP are driving local component assembly, with several
players entering and announcing investments.
5. Charging infrastructure- Driven by increasing scale and PMP thrust, assembly of DC
chargers and software programming is already localized.
1. Cell component manufacturing - While the ACC PLI will accelerate pace of cell
manufacturing indigenisation, targeted interventions will be required to boost development
of local cell component supply chain in India.
2. Battery assembly – There is strong expectation of the assembly being localized at scale in
India, owing to the current policies. However, contactors are currently being imported due to
nascent semiconductor and electronics manufacturing ecosystem in India.
3. Other EV specific components – Some sub-components like rare-earth magnets for
e-motor are still imported due to lack of local RM processing and limited enforcement
of PMP. Additional support for ensuring consistent supply of key RMs is required to power
localization.
4. Charging infrastructure – Potential gaps, caused by limited enforcement of PMPs for EVSE
hardware sub-components, need to be closed to drive localization.
Exhibit 34: 7 areas prioritized for benchmarking
Other EV specific components
E-motor drive Power electronics EV electricals
Traditional auto components
Charging
infrastructure
EV assembly
by OEMs
3
67
45
Cell component
manufacturing
Cell
manufacturing
Battery
assembly
1
2 53Assessment of EV Supply Chain
Exhibit 35 : Exemplar of Steps 1 & 2 - Cell component manufacturing supply chain landscape in
India
3.3 Methodology for deep-dive
A step-by-step approach was followed for each of the 7 priority areas to prioritize sub
components that are still imported and identify additional government interventions that
would be required basis global benchmarks.
Lack of
lithium,
nickel and
cobalt
reserves in
India
Limited
reserves of
Manganese
in India
Cathode
active
Material
(only
global
players)
Only Global
Players
Only Global
Players
Only
Global
Players
Only
Global
Players
Packaging
foil, binder
tape, glue
etc.
Cathode
binders
Select
Indian
players
Select
Indian
players
Graphite
Anode
Material
Select
Indian
players
are
conducting
pilots
Anode
binders
Select
Indian
players
Raw
Materials
Cathode
Mix CAM
Aluminium
Foil
Carbon
Powder
Copper
Foil
Graphite
Anode
Active
Material
Electro-
lyte
Separa-
tors Other
24-26% 14-16%9-11%6-8% 9-11% 6-8% 4-6%
Imported
as part of
cell
Imported
as part of
cell
Imported
as part of
cell
Manufactured
in India
Imported
as part
of cell
Manu-
facturing
pilots
ongoing in
India
Imported
as part of
cell
Imported
as part of
cell
Manufac-
tured
in India
Key Players
Cost
Salience
Localization
Status
1. As a % of Total material cost of battery (NMC 811 cylindrical) ; module & pack assembly make up
the remaining 19-23%
Imported components manufactured only by global playersPrioritized for benchmarking
Understanding the detailed value chain and current localization landscape for 7 priority
areas
Across the globe, barring a few large Chinese players like BYD and CATL, the EV and EV
component supply chain is fragmented with multiple different players operating across
the value chain. Our analysis elucidates that there is limited backward integration in this
industry implying that localization of one component in the value chain would not necessarily
accelerate localization of another. Therefore, for each of the priority areas, the value chain
was understood and each component was broken into subcomponents. E.g., cell component
manufacturing was further disaggregated into cathode mix, aluminum foil, carbon powder,
copper foil, graphite, electrolyte, separators, and other consumables to identify the key
bottleneck(s) to localization. Next, the current supplier landscape and localization status
at a sub-component level was charted out to identify components still being imported and
prioritize those for further analysis.
Salience of key components in cell manufacturing 54Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Exhibit 36: Exemplar of Steps 3 to 6 for cell component CAM - Outlook for localization in India
For prioritized sub-components, mapping drivers of localization in key geographies and
starting point in India
For each prioritized sub-component, geographies where the subcomponent is already
localized at scale as well as those geographies where localization is currently underway
were identified. Next, a thorough analysis was conducted to identify key drivers of localization
in each of the identified geographies, e.g., proximity to raw materials, capital subsidies or
subsidized land form the government, technology leadership, etc. These learnings will help
emulate the tried and tested best practices from across the globe to accelerate localization in
India. Therefore, next, key success factors for India were contextualized to identify imperatives
that would drive capacity investment in India. Having done that, India’s starting position
against each of the success factors was baselined based on industry outlook, investment
activity, policy support, structural challenges like cost non-competitiveness, etc. This structured
methodology was repeated for each area of the e-mobility value chain to identify key
challenges to localization..
• Being addressed by ACC PLI; 50GWh Li-ion cell
capacity expected by 2026/27
• 8-10% disadvantage at unit cost for manufacturing
locally compared to China, due to unavailability of
local RM and RM processing facility
• 10-15% capital grants provided by European countries
to invite local investment (providing superior ROCE)
• Individual university research groups have initiated
research in this field (e.g., CAM research being
conducted by IIT Madras and KIT2, Germany)
• Lack of skill development programme to upskill
workforce
Key Success
Factors Criticality
Current
Starting Point Details
• Downstream
demand
• Cost Leadership
• Policy Support
• (E.g., subsidized
land)
• Technology
leadership in CAM
processing
• Downstream
demand and
proximity to battey
makers
• Technology
leadership in CAM
processing
• Grants given by
government to set
up CAM facility
• Downstream demand
andproximity to
customers
• Capex grants given by
European government
as well as supportive
battery eco-system
created by EC
Japan
ChinaSouth
Korea
Europe
USA
Sufficient local
downstream
demand (~20-
30GWh)
Enabling
eco-system
to support
large scale
investment
R&D
experience in
CAM to ensure
high yield;
Labor skilled
in inorganic
chemistry
Strong
1. Localization underway 2. Karlsruhe Institute of Technology
Moderate/On-track Weak 55Assessment of EV Supply Chain
Exhibit 16 highlights the above-mentioned process for one of the prioritized sub-components
viz. CAM NMC. Further, the unit cost of producing CAM NMC in India vs that in China was also
analyzed to bring to light any structural disadvantages facing India. Our analysis shows that
China enjoys local processing of CAM precursor (PCAM), which is not the case for India, leading
to additional import duty burden, logistics costs, and higher RM (PCAM) cost for ex-Chinese
buyers. Secondly, China enjoys 10-15% cheaper power owing to policy support. These factors
contribute to ~8-10% disadvantage for production at unit cost in India as compared to China.
Separately, it was also observed that globally, governments are attracting investments in CAM
plants by offering ~10-15% capital grants to improve project ROCE. E.g. BASF received €175M
capex grant through EC’s IPCEI for setting up a CAM production facility in Finland.
Creating a view on potential government interventions to drive localization
Having developed an intricate understanding of the key challenges to localization, the possibility
of localization at a sub-component level was estimated. This facilitated the identification of
specific government interventions that are required to drive localization of each prioritized sub-
component across the EV value chain.
3.4 Challenges to localization & key
interventions required
The above deep-dive approach was carried out across the 7 priority areas using industry expert
discussions and benchmarking of the global and local supply chain landscape. Consequently,
13 components were identified which will require additional government thrust to drive
localization.
Exhibit 37: Components requiring additional intervention for localization
Cell component
manufacturing
Cell
manufacturing
Battery
assembly
Charging
infrastructure
EV assembly
by OEMs
Rectifier
CAM
BMS
Controller
Copper foil
Contactor
Connector
(CCS)
Separator
Connector
(Type 2)
Electrolyte
AAM
Rare earth
magnets
AC charger
assembly
7-10
20-25
3-5
2-4
1-2
3-5
4-6
2-5
5-7
<0.5
<0.5
<0.5
<0.5
Other EV specific components
E-motor driveEV electricalsPower electronics
Traditional auto components
Market size in Rs. K Cr. 56Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
ComponentKey interventions required
CAM• Incentives in short-term to offset
structural unit cost disadvantages for
production in India. Potential levers can
be import duty relief for RM imports
(observed in Europe), production-linked
subsidy or subsidized power cost
• Securing access to critical RM (E.g.,
Lithium, Cobalt, Nickel)
• Capital subsidy from the government
and financing support / commitment
from banks, to create an enabling
ecosystem and improve project ROCE
• Offering R&D grants, as observed in
Europe (Battery 2030+, BATT4EU, Horizon
Europe)
• Fostering industry-academia
collaboration to upskill local talent, as
observed in Europe (E.g., ALBATTS, EBA
Academy), can help significantly
• 8-10% disadvantage at unit
cost due to unavailability
of RM and RM processing
locally
• Capital intensive
component requiring
$300-400M for 20-30GWh
plant
• R&D experience in CAM to
ensure high yield
• Low availability of labor
skilled in inorganic
chemistry
Challenges to localization
Copper foil • Capital intensive
component requiring $150-
250M for 20-30GWh plant
• Lack of R&D experience
in producing ultra-
thin Copper foil(insure
consistent thickness, foil
integrity and RPM of Drum)
• Limited copper reserves
are another challenge
• Project finance support through
financing commitments from banks and
capital subsidies from government
• Offering R&D grants to encourage joint
research on national EV and battery
R&D priorities
• Up-skilling/ re-skilling local workforce
by joining hands with industry and
academic participants to create
employable EV and battery workforce
• Securing access to critical RM (Copper).
Separator
Electrolyte
• Highly capital-intensive
component ($300-500M
for 20-30GWh plant)
• Lack of labor with
experience in operating
separator lines and
coating process know-
how.
• 2-3% unit cost
disadvantage due to
unavailability of RM locally
• Absence of R&D in
electrolyte formulation &
technologies.
• Lack of labor skilled
in electrochemical
techniques
• Securing access to critical RM like lithium
salts
• Offering R&D grants in line with European
examples.
• Creating a specialized curriculum
(E.g. familiarity with physico chemical
properties of electrolyte measurement)
in partnership with industry-academia
to support up-skilling of local workforce
• Financial grants from government to
attract large capital investments in India
vis-a-vis other geographies. Project
finance support through preferential
loans from banks, government
guarantees, etc.
• Foster industry academia collaboration
to upskill local talent
As detailed out in Chapter 2, a thorough benchmarking of how governments world over are
stepping in to drive localization has been carried out. Emulating the key learnings, certain
interventions have been proposed below to combat challenges to localization in India. 57Assessment of EV Supply Chain
Anode Active
Material (AAM)
• Capital intensive
component ($160-250M for
20-30GWh plant)
• R&D required for mastering
the technology needed
to produce higher
performance AAM
• Capital subsidy from govt. and
financing support from banks, as
observed in Europe, can help create
an enabling eco-system
• Offering R&D grants in line with
European example
Contactors
Rare earth
magnets
• Lack of expertise in
producing contractors
• Mining of Rare Earth
element Neodymium
is not done in India
currently
• Expanding IREL’s focus towards Rare
Earth element Neodymium mining for
producing permanent magnets.
• Incentivize exploration of alternate
sources of Neodymium (E.g.
Carbonatite reserves)
BMS• Lack of Expertise in
SMT and production of
semiconductors
• Fostering industry academia
collaboration to upskill local talent, as
observed in Europe.
Rectifier • Assembled modules from
China are 15-20% cheaper
• Limited semi conductor
manufacturing capability
in India
Support existing PMP program for
EVSE components with the following
interventions:
• Promote EVSE suppliers procuring
locally by adding localization as
qualification criteria in tenders
• Phased increase of import duty on
completely assembled components
(e.g., in line with PMP program on xEV
parts)Controller • Lack of R&D capability for
power-line communication
but global players with
existing capabilities (e.g.,
Bacancy) already entering
the market
• Limited semiconductor
manufacturing capability
in India
Connector
(CCS/
CHAdeMO)
• Availability of low-cost
Chinese products
• Limited import restrictions
making it easier for
assemblers to import
ComponentKey interventions requiredChallenges to localization 58Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Connector
(Type 2)
• Availability of low-cost
Chinese products in the
market
• Limited import restrictions
making it preferable for
assemblers to import
AC
Charger
Assembly
• Availability of lower priced
products from China,
given the large scale of
manufacturing (40-50%
difference in cost for large
players when assembling
in China vs. locally at
current scale)
Broadly, the following key challenges to localization have been observed:
• Lack of level playing field for select components because of structural unit cost
disadvantages for production in India (e.g., in the case of CAM NMC, because of
unavailability of RM processing locally)
• Limited enabling ecosystem to support high capex greenfield investment in India vis-à-
vis other countries for select cell components (e.g., investments in CAM, separators, copper
foil, AAM have individually received capital grants in Europe, coupled with access to cheap
financing, thereby enjoying superior project ROCE)
• Lack of local R&D experience in high-tech cell component areas like CAM manufacturing,
copper foil manufacturing, etc
• Low availability of highly skilled labor e.g., in CAM, Copper Foil, BMS manufacturing, etc
• Limited localization mandate to ensure enforcement of phased manufacturing programs
for EVSE
In the ensuing chapter, key interventions have been proposed to address these challenges and
further develop the local EV value chain.
References:
35. Singh, Vaibhav, Kanika Chawla, and Saloni Jain. 2020. Financing India’s Transition to Electric Vehicles: A USD 206 Billion Market
Opportunity (FY21 - FY30). New Delhi: Council on Energy, Environment and Water.
36. PIB, 12 May 2021, Cabinet approves Production Linked Incentive scheme “National Programme on Advanced Chemistry Cell
Battery Storage”
37. https://www.business-standard.com/article/economy-policy/four-firms-selected-for-rs-18-000-crore-pli-scheme-for-acc-
battery-122032400524_1.html
38. PIB, 11 February 2022, 20 Applicants have been approved under “Champion OEM Incentive Scheme” of the Production Linked
Incentive (PLI) Scheme for Automobile and Auto Component Industry in India
39. https://www.bloombergquint.com/business/meity-invites-applications-for-second-round-of-large-scale-electronics-mfg-
under-pli-scheme
40. https://economictimes.indiatimes.com/small-biz/sme-sector/with-rs-76000-crore-pli-scheme-india-set-to-action-its-
semiconductor-fab-vision/articleshow/88848107.cms
41. https://auto.economictimes.indiatimes.com/news/policy/faqs-a-comprehensive-roundup-on-indian-ev-policies/89290126
42. https://heavyindustries.gov.in/writereaddata/fame/famedepository/8-E__didm_WriteReadData_userfiles_revisedPMP29A -
pril2019%20(1).pdf
43. Phased Manufacturing Program (PMP) for xEV Charger Parts for eligibility under FAME India Scheme Phase II - Reg., Ministry of
Heavy Industries, 2 November 2021
Support existing PMP program for
EVSE components with the following
interventions:
• Promote EVSE suppliers procuring
locally by adding localization as
qualification criteria in tenders
• Phased increase of import duty on
completely assembled components
(e.g., in line with PMP program on
xEV parts)
ComponentKey interventions requiredChallenges to localization 60Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
04
Proposed Reforms
and Roadmap for
India 61Overview of EV Adoption in India 62Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
4.1 Proposed Interventions
Based on the exhaustive analysis of the e-mobility value chain, benchmarking of global best
practices for EV policies and regulations and discussions with industry experts, a 16-point
action agenda across the following 4 key thrust areas is proposed to address the challenges to
localization to further develop the local EV value chain.
1. Enable EV component manufacturing at scale by creating an enabling eco-system and a
level-playing field for select high priority components
2. Ensure consistent availability of critical & strategic EV and Battery raw materials to
strengthen mineral security of the nation
3. Foster centrally coordinated multi-stakeholder efforts for R&D in EV innovation
4. Facilitate industry-academia collaboration for re-skilling and up-skilling the Indian
workforce in line with skills and competencies needed to emerge as a leader in the growing
Battery & EV manufacturing ecosystem
The 4 key thrust areas have been further detailed out across 16 Action Items, covering the need
for proposed intervention (context), key activities or scope of each intervention, key roles for
operationalization, and expected impact.
Set up Hi-Tech
EV component
corridor
Ensure mineral
security of key
battery RMs
Upgrade existing
infra and faculty
skill set
Develop National
strategic R&D
agenda for EV
Project financing
commitment
from banks for
e-mobility projects
Enable mining of
Neodymium in
India
Curate curriculum
for Univ/ ITIs/
VETs, etc
Set up EV
& Battery
Innovation hubs
Offset structural
unit cost
disadvantages
Set up Raw Materials
Investment Platform
Enable on-
demand ‘Phygital’
learning
Incentivize
investments
in R&D
Consider
localization
mandate for EVSE
Explore opportunities
to attract greenfield
project investments
Promote
sustainability
standard & ethical
sourcing
Set up Centers
of Excellence
(CoE)
11013
14
15
16
11
12
2
3
4
9
8
7
6
5
EV & EVSE component
manufacturing at scale
Mineral security &
availability
Re-skilling & Up-skilling
workforce
R&D for EV
innovation
Promoting Clean Energy Usage through Accelerated
Localization of E-Mobility Value Chain 63Proposed Reforms and Roadmap for India
Thrust Area 1 – Enable EV component manufacturing at scale by creating an enabling
eco-system and a level-playing field for select high priority components
I. Context
India faces structural unit cost disadvantage in the production of select cell components
(e.g., 8-10% for CAM NMC and 2-3% for Electrolyte). Further, certain cell components such as
Separators, CAM NMC, Copper foil, Anode Active Material (AAM), etc. require large scale capital
(greenfield project) investment (200-500M$ for 20-30 GWh plant).
Globally, governments are stepping in to support localization of the EV component supply
chain:
• IPCEI fund (€ 6.1B) set up by EU to provide capital grants (for greenfield investments) for cell
component manufacturing
• Individual state-aids (capital grants) given by EU countries (typically 10-15% of project cost),
e.g., Hungary and Poland, to attract local investments (providing superior ROCE)
• Land cost subsidies provided in China
To promote localization of cell component manufacturing in India, it is imperative to offset
the structural cost disadvantages and create an enabling eco-system to attract large-scale
capex investment vis-à-vis other geographies.
Moreover, there has been limited localization at scale in EVSE manufacturing in India thus
far. Across DC Chargers, larger 120kw+ chargers are presently imported as completely built
units while 50-60kW chargers are assembled locally. However, 60-70% components by value
continue to remain imported even for chargers assembled locally. Key imported components
include Rectifier, CCS/CHAdeMO Connectors and Controller. Further, AC chargers are imported
as completely built units by large EVSE OEMs. Startups that assemble locally are currently
importing 30-40% components by value - Type 2 connector (25-30% of total cost) is the key
imported component.
Based on our analysis, following are key challenges to EVSE localization in India: Low scale to
manufacture EV specific components, e.g.., rectifier, connectors; Availability of cheap Chinese
alternatives, e.g., 40-50% difference in cost for large OEMs if they assemble AC chargers in India
vs. China; and nascent semiconductor manufacturing industry in India. While the Ministry of
Heavy Industries has launched Phased Manufacturing Program for EVSE components in 2021
to drive localization, currently, localization criteria are not included in tenders by state nodal
agencies deploying charging networks.
II. Proposed Initiatives (Actions 1 to 5)
#1 – Develop Hi-Tech EV component corridors, along existing auto belts, in partnership with
state governments
Developing Hi-tech industrial corridors, earmarked for EV related investments can help in
creating the enabling ecosystem required for localization of select strategic components
in India. The EV component corridor should be located in the existing auto belts (thereby
leveraging existing ecosystem & market linkages). E.g.:
I. South – Chennai-Hosur-Coimbatore cluster where OEMs like Ford, Hyundai, Renault,
Mitsubishi, Nissan, BMW etc. are located
II. North – Delhi-NCR cluster (Delhi, Gurugram, Ghaziabad, Faridabad) where the country’s
largest car manufacturer, Maruti Suzuki, is based
III. West – Mumbai-Pune-Nashik-Aurangabad; Audi, Volkswagen, and Škoda are located in
Aurangabad. Mahindra and Mahindra has a vehicle and engine assembly plant at Nashik.
Tata Motors, Mercedes Benz, Land Rover, Jaguar, Fiat, and Force Motors have assembly
plants in the Pune-Pimpri area 64Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
The salient features of the corridor would be the following:
Must haves:
• Good connectivity with EXIM gateways along with on-site custom clearance
• Located in proximity of existing auto cluster
• Production facilities (ready-made sheds, warehouses, assembly units) for purchase/lease
• Dedicated single window clearance support along with competitive incentive package,
transparent disbursal process
• Shared infrastructure - Common testing circuits, workshop & tool sharing facilities for
MSMEs
Good to have:
• Skilling centers and academic institutions easing transition from ICE to EV and developing
specialized skill
• Social infrastructure - Mixed use residential complexes, schools, colleges, hotels &
conference centers, hospitals
• Sustainability - Common wastewater/effluent treatment plants and captive renewable
power plants
It would also be critical to attract 2-3 anchor investments across cell / battery value chain
to create a virtuous cycle of investments across the corridor. This would include creating
attractive value propositions and pitching to key cell / battery value chain players to attract
investments in the corridor. Below is an illustrative list of key stakeholders that could be
approached:
Stakeholders for outreach (Illustrative list):
1. Battery Assembly: Exide, Amara Raja, Ola Electric, Uno Minda, Trontek, Amptek
2. Cell Manufacturing: Hyundai, Reliance New Energy Solar Ltd, Ola Electric, Rajesh Exports Ltd,
Amara Raja, Exide, Lucas TVS, Samsung SDI, LG Chemicals
3. CAM: Posco, BASF, Ecopro, Umicore, Sumitomo, Nichia, Johnson Matthey, Mitsubishi
Chemical, Hitachi Chemical, Epsilon
4. Separators: Daramic, SKIET, Toray, Asahi Kasei, UBE, Sinoma, Senior, Yunnan Energy
5. Copper Foil: Iljin, SK Chemicals, KCF, Nippon Denkai, Furukawa Electric, CCP, Wason
6. Aluminium Foil: Hindalco, Lotte Aluminium, UACJ, Chinalco, Longding Alu
7. Electrolyte – Mitsui Chemical, Mitsubishi Chemical, UBE, Enchem, Soulbrain, Shanshan, Tinci
8. Anode Active Material: GFL, Himadri, Epsilon, Elkem, Posco, Showa Denko, Mitsubishi
Chemical
9. Start-ups/ MSMEs innovating in the cell component manufacturing space: Allox, Log9
Materials
#2 – Green financing commitment from banks for supporting large-scale greenfield project
investment in India (especially for CAM, AAM, Copper Foil & Separators)
Taking cue from the green financing commitments secured by EU from local banks such as EIB
and EBRD, it would be crucial for the government to work with the financial sector to channelize
lending towards more sustainable technologies and businesses (E.g. EV Cell manufacturing
projects). This would be very important for attracting greenfield project investments in certain
capital-intensive high priority items like CAM, Separators, Copper Foil and AAM. 65Proposed Reforms and Roadmap for India
#3 - Provide support to offset structural unit cost disadvantages for production in India
#4 - Explore opportunities to attract greenfield project investments in select high priority
cell components (i.e., CAM NMC, AAM, Copper Foil & Separators) where need-gap still exists
despite the PLI schemes
#5 – Consider localization mandates to accelerate set up of EVSE component manufacturing
& assembly in India
Further, the central government would need to work with the state governments to offset
structural unit cost disadvantages for production in India, specifically for CAM NMC and
Electrolyte manufacturing which suffers from 8-10% and 2-3% disadvantage respectively.
This could be done via any of the following levers: import duty relief for import of PCAM (RM),
subsidized power, inclusion of CAM NMC into PLI scheme etc.
Moreover, as highlighted previously, certain cell components are highly capital intensive (200-
500M$ investments for 20-30 GWh plant). Existing schemes like PLI / state-level incentive
programs could be channelized towards these to incentivize investments in these components
in India vis-à-vis other geographies. E.g., Karnataka state government is offering upto 15%
of project capex as capital subsidy for cell manufacturing (which overlaps with ACC PLI).
This support could instead be channelized for these need-gap components (i.e., CAM NMC,
AAM, Copper Foil & Separators). Research indicates that globally, governments are typically
providing 10-15% capital grants for attracting greenfield investments in cell components
(providing superior ROCE) e.g., €175M capex grant received by BASF through EC’s IPCEI for
setting up a CAM production facility in Finland, €47M capex grant received by Toray for setting
up a separator facility in Hungary, etc
Introduce localization criteria in tenders by DHI
(49)
and State Nodal Agencies (under Bureau of
Energy Efficiency) across the country for setting up public charging stations (PCS), i.e., ensure
following components are localized with minimum 50% domestic value addition by respective
dates
Targeted value chain segment
Charger Enclosure, Internal Wiring Harness, IEC 60309
connector, Software, Auxiliary Power Supply, SMPS
Energy Meter, HMI / Display / RFID, Input Switchgears
(Fuses, MCBs, etc.), Output Switchgears (DC/AC
Contactors, Relays, etc.)
Charging guns (CCS, CHAdeMO, Type2, Bharat DC001),
Charger Controllers, Rectifier Modules
Localization phases (as per PMP)
Phase 1
Phase 2
Phase 3
Further, mechanism for tenders (e.g., L1 bidder with localization above threshold to be given
preference over other bidders with similar pricing) would need to be detailed out.
Additionally, increase import duty on select components such as Rectifier, Connectors (CCS,
CHAdeMO, Type 2), Controller & completely built units for AC chargers in line with PMP, to further
drive localization. It would be important to decide quantum of import duty to be levied for
different components based on PMP & enforce recommendation through Ministry of Finance.
E.g.., BCD rates on EV auto components increased from 0% to 15% from April 2021 (post PMP
deadlines of all components)
(50)
. 66Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
#6 - Ensure mineral security of key battery RMs
III. Expected Impact
• Faster inflow of greenfield project investments in EV component manufacturing owing to
proximity to downstream (auto) players
• Indigenized production of EV components at competitive costs of production (reduced
reliance on imports)
• Accelerated creation of jobs for EV component manufacturing
• Boost to logistics and other infrastructure development through creation of EV component
corridor
• Accelerated development of local supply chain for EVSE components (both AC and DC
chargers)
»Development of local assembly capability for Rectifiers, Controllers for EVSE
»Development of local supplier ecosystem for CCS, CHAdeMO, Type 2 Connectors
»Self-sufficiency in EVSE manufacturing (reduced reliance on China)
I. Context
Given lack of local mineral reserves, India is dependent on imports for most raw & advanced
battery materials (E.g., Lithium, Nickel, Cobalt, Copper, Manganese). Further, India is heavily
dependent on specific geographies for Rare-Earth Permanent Magnet – a critical sub-
component of E-motors. To increase India’s independence across the raw material value chain
and to make it more resilient to geo-political shocks, it is crucial to diversify its supply chains
and ensure a consistent supply of critical and strategic minerals to Indian domestic market.
II. Proposed Initiatives (Actions 6 to 9)
Thrust Area 2 – Ensure consistent availability of critical & strategic EV raw materials to
strengthen mineral security of the nation
Presently, KABIL
(47)
has been tasked with securing consistent supply of 12 critical and strategic
minerals for India – including 2 key battery RMs viz. Lithium and Cobalt. However, consistent
access to certain other key battery RMs like Nickel, Copper (limited local reserves, India is a
net importer) and Manganese (limited local reserves, India is a net importer) also needs to be
secured. This could be achieved by establishing a central nodal agency or leveraging existing
PSUs to further the aforesaid agenda.
For each of these critical minerals, the government (through central nodal body/PSU)
would need to establish an agile and inclusive stakeholder consultation process to identify
bottlenecks such as regulations, permits or operating licenses across the raw material
value chain. For minerals that are locally scarce, the government would need to identify on
a global level primary sources (mining) and secondary sources (re-cycling) of critical RMs
and consequently drive strategic trade partnerships with resource-rich countries. Further, the
government could also explore regulatory measures to incentivize exploration, mining, and a
full critical raw material circular economy, across the entire value chain (E.g., through waste
directives, legislation promoting retention of End-of-Life products, etc.).
To operationalize these initiatives, it would be pertinent to establish a working group
comprising representatives from DHI, BEE and EVSE OEMs to detail policy recommendations
(e.g., localization criteria, quantum of import duty to be levied by component, etc.). It would be
advisable to set up a up 6-month review frequency to track enforcement of localization criteria
by testing agency of MHI through documents submitted at tender RFP stage. 67Proposed Reforms and Roadmap for India
#7 - Enable mining of Neodymium in India for producing Permanent Magnets
Currently, Indian Rare Earths Limited (IREL)
(46)
has been given a monopoly over the primary
mineral that contains REEs: Monazite beach sand. IREL’s focus is to provide thorium — extracted
from Monazite — to the Department of Atomic Energy. IREL produces rare earth selling these
to foreign firms that extract the metals and manufacture end products. KABIL would need to
work with IREL to direct its focus towards Neodymium mining, at scale, to localize production
of NdFeB magnets. By 2030, projected EV demand in India is 11-12M vehicles. This translates
to NdFeB demand of ~16,500 T by 2030. Accordingly, additional capital investment may be
required to expand IREL’s existing mining set-up to meet the growing NdFeb demand, as
well as to start processing, refining and reduction operations in India. Further, India suffers
from certain structural disadvantages at unit cost, in comparison with China, as highlighted
below. The government will need to offset these disadvantages to accelerate indigenization of
Neodymium mining.
Presently done on a limited scale
2

by IREL to supply Thorium to DAE
3
.
Additional investment will be
required to scale-up operations
Separation of
Uranium, Thorium
from Monazite
Exploration
& Develop-
ment
Mining &
Produc-
tion
Separa-
tion
Process-
ing
Refining &
Reduction
Estm. Investment
needed to meet
2030 demand
INR 12K-
13K Cr
INR 1.5K-
1.8K Cr
INR 750-
900 Cr
INR 150-
180 Cr
Input 600L T
Sand
60L T
Illuminite
90K T
Monazite
45K T
Mixed REOs
16.5K T
Neodymium
Oxide
Output 60L T
Illuminite
90K T
Monazite
45K T
Mixed
REOs
1
16.5K T
Neodymium
Oxide
13.2K T
Neodymium
Metal/
Alloy
Projected demand for 2030
based on estm. EV demand of
11M-12M vehicles by 2030
Complex Processing in India
• Source of Chinese REO is Basnaesite
(Processing relatively simpler
than Monazite)
• For India, additional processing
cost (5-10%) of Thorium & Uranium
which are radio active - need to
be handled, stored and monitored
appropriately
40-50% higher labor productivity
in China
• Labour productivity higher in China
due to stringent labor laws (e.g.
longer shifts - Continuity of same
person for finishing E2E task ensures
lower downtime/better output as
compared with shift workers)
50-60% cheaper electricity in China
due to policy support
• China: $0.04-0.05/ unit
• India:$0.10-0.12/ unit (varies by State)
India suffers from certain structural
disadvantages at unit cost,
compared to China
1. Rare Earth Oxide (REO) 2. ~2300T REO produced in 2016-17 3. Dept. of Atomic Energy (DAE) 4. EVs use ~1.5kg NdFeB magnets for PM motors
It would be crucial to provide funding support / capital incentives for setting-up Neodymium
processing, refining and reduction facilities in India and bridging structural disadvantages for
production at unit cost.
Moreover, it is imperative to identify alternate sources (E.g., Carbonatite reserves) of
Neodymium, beyond monazite sand to further stabilize supply of Neodymium for producing
Rare-Earth Magnets. The ever-increasing demand for Rare Earth Elements necessitates a
concerted effort to augment the resource position of our country. The Geological Survey of
India, as a part of routine mineral survey, has been carrying out preliminary investigation
for identifying REE rich zones in selected sectors. Similarly, while the Atomic Minerals Division
(AMD) of the Department of Atomic Energy has been actively engaged in the exploration of
such mineral deposits in different parts of our country, discussions with subject matter experts
Exhibit 38: Additional capex investment required for processing Neodymium Oxide (from
Monazite) and additional support required to create a level playing field 68Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
#8 - Set up a Raw Materials Investment Platform (RMIP) to help leverage investment (JVs)
in a pipeline of key projects
#9 - Establish sustainability standard and certification scheme to ensure high quality and
sustainable output by domestic players & promote ethical sourcing and transparency in
value chain by enforcing the respective standards
Based on our analysis, certain key learnings from Europe could be emulated by India. to
ERMA
(44)(45)
in Europe, set up a platform for investment matchmaking to ensure high investment
success rates. The prioritized cases to secure primary and secondary raw materials supply for
European industrial ecosystems are listed on the platform which aims to bring investors and
investees together and define case-specific financing strategies (grant, equity, loan, mixed)
and investment structures.
The government and industry players will need to align on a framework for establishing
sustainability in the raw material(s) value chain. This would involve leaders from the
downstream industry, particularly the automotive industry, and would include the analysis
of existing schemes by a dedicated taskforce. E.g., ISO/TC298 Rare Earth group – the leading
standardization initiative in Rare Earths worldwide today – should be followed by domestic
players. Subsequently, it would be crucial to promote ethical sourcing and transparency in
value chain by enforcing the respective regulation(s) made applicable above.
indicate that less than 5% reserves have been explored for Carbonatite by state-owned
enterprises (Gujarat and Rajasthan are the few known sources currently). Therefore, it would
be beneficial if the government incentivizes exploration of alternate sources (E.g., Carbonatite
reserves) of Neodymium to accelerate this effort.
III. Expected Impact
• Consistent supply of critical raw materials through primary (mining) and secondary
(recycling) sources
• Domestic capabilities across the raw material value chain built (as domestic players form
JVs to enter the upstream play)
• Mitigation against geo-political risks and increased import substitution (E.g., Reduced
dependence on China for Neodymium (Permanent) Magnets)
• Locally processed critical raw materials to come with quality standards and transparent
supply chains
Thrust Area 3 – Foster centrally coordinated multi-stakeholder efforts for R&D in EV
innovation
I. Context
EV and battery are key pillars for transition towards sustainable mobility, and to be at
the forefront of the e-mobility industry, continuous investment in R&D is critical. Globally,
governments are investing heavily in e-mobility R&D (especially for battery) and stepping up
to support coordinated efforts around R&D to keep up with the ever-evolving industry. E.g., EU
has launched multiple R&D initiatives (industry-academia collaborations) such as Batteries
2030+, BATT4EU, with dedicated funding support from Horizon Europe (€95B+ till 2027 towards
R&D in sustainable mobility, including € 1.4B+ till 2021 across Battery R&D).
India will need to invest ahead of the curve in R&D to accelerate adoption, by improving battery
energy density, cycle lifetime, reducing cost, etc. Given that India presently lacks the process
expertise for producing many complex EV and battery components (E.g., CAM, AAM, Copper
Foil, Electrolyte) requiring high technical know-how to ensure high yield, it is even more critical
to support indigenous players in developing competitive technology (vs global players).
Presently, e-mobility research is happening independently in fragments across institutions with 69Proposed Reforms and Roadmap for India
no coordinated roadmap of the nation’s key R&D vision/priorities (E.g., CSIR-CECRI are working
on electrochemical research, IIT Bombay and Bar-llan University are jointly conducting R&D on
solid state batteries, IIT Madras and Karlsruhe Institute of Technology are jointly researching to
improve performance of LIB cathode materials, IIT Madras’ C-BEEV focuses on R&D in battery
and EV). A centrally coordinated effort bringing together some of India’s brightest minds,
complemented by shared R&D infra and financial incentives, will accelerate the journey from
prototyping to industrialization.
II. Proposed Initiatives (Actions 10 to 12)
#10 - Develop India’s EV & battery specific strategic research agenda covering short-,
medium- and long-term R&D priorities
India has many academic institutions and national laboratories that have facilities that
conduct e-mobility research, E.g. research pertaining to batteries. However, to accelerate
indigenization of energy storage manufacturing, Indian R&D centers need to focus more on
collaborative research with the industry to solve problems associated with current battery
technologies as well as collaboratively develop next-generation technologies to become
truly independent. There is a pressing need for the government to orchestrate the industry
academia-startup collaboration by laying out a national EV and battery specific strategic
research agenda covering short-, medium- and long-term R&D priorities. This initiative
could be fostered centrally through some of the existing set-ups such as – C-BEEV’s
1
CoBE
2

(under DHI
3
& MEIT
4
); ARAI’s
6
TechNovuus
7
(under DHI
3
); iCAT’s
8
ASPIRE
9
(under DHI
3
); DHI
3
-DST
5

Technology Platform for Electric Mobility (TPEM)
(48)
.
The unified body would need to baseline the extent of R&D done in India in this space in smaller
fragments across start-ups, universities, and industry and then hold industry-academia
consultation to understand current challenges (E.g., competitiveness, sustainability, industrial
upscaling, uptake, etc.) across the battery value chain (Similar to C-BEEV-CoBE’s consultation
with key players like ABB, Exide, Amara Raja, Exicom, etc.). Accordingly, India’s R&D priorities
would be identified. Based on global benchmarks, below is an illustrative list of R&D priorities
that have been identified for battery innovation as an exemplar.
1. Centre of Battery Engineering and Electric Vehicles (C-BEEV) 2. Centre of Battery Engineering (CoBE) 3. Dept. of Heavy Industries
(DHI) 4. Ministry of Electronics and Information Technology (MEIT) 5. Department of Science & Technology (DST) 7. TechNovuus
is an indigenous, multi-domain collaborative platform developed with the aim of enabling our brightest minds to unlock
the potential of new technologies and innovations to shape the future of mobility 8. The International Centre for Automotive
Technology (iCAT) 9. Automotive Solutions Portal for Industry Research & Education (ASPIRE) – A Technology platform to facilitate
the Indian auto industry (including OEMs, Tier 1 Tier 2 & Tier 3 companies), R&D institutions and academia to come together for
R&D, technology development, shop floor/ quality/ warranty issue’s resolution, expert opinions etc. on issues involving technology
advancements
Exhibit 39 : Potential R&D priorities
Illustrative, based on global benchmarks
a) Potential short/medium term priorities
• Increase battery energy density
• Improve cycle lifetime
• Increase battery power density and charging rate
• Reduce battery costs
• Enhance battery safety in the different targeted application sectors
• Decarbonization of battery raw materials processing
• Aqueous, dry and alternative coating processes 70Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
#11 - Provide funding to develop the required infrastructure for EV and Battery Innovation
hubs within reputed institutions, to promote collaborative research between Industry,
Startups and Academia
#12- Provide incentives to industry, academia, and start-ups to conduct collaborative
research across identified priority areas
• Setup innovation labs providing testing and prototyping infrastructure and supporting
commercial product development from lab prototype
• Provide linkages to other researchers to facilitate research progress and reduce barriers to
commercialization
• Create an innovation platform (digital) to host R&D projects based on identified priorities
and invite stakeholders to further the research agenda
Based on learnings from global benchmarks, it is pertinent to facilitate access to funding
sources for conducting research and for prototype/commercial product testing. This will
promote faster and greater collaboration across players to work towards common research
priorities laid out for the nation. As observed in Europe, EU’s Horizon Europe (major R&D funding
program) has been greatly successful in developing collaborative partnerships between
industry and academia to focus on the R&D projects listed on EU’s portal. Further, incentivizing
R&D projects for laid out priorities would also speed up the commercialization of newly
discovered technologies, materials, etc.
• Recovery of metals and chemicals from new sources such as industrial or urban wastes
• Automating the dismantling of batteries, reducing costs by avoiding manual work and
improving sorting of parts for their replacement or recycling
• Digitalization of battery testing
b) Potential long term priorities
• Develop self-healing functionalities for batteries
• Identify novel chemistries beyond li-ion
• Develop advanced all solid-state batteries
• Create autonomous, ‘self-driving’ labs capable of designing and synthesizing novel battery
materials, and of orchestrating and interpreting experiments on the fly (using AI, ML &
Robotics)
• Developing a shared and interoperable data infrastructure for battery materials and
interfaces, linking data from all domains of battery discovery and development cycle
• Development of secure, real-time, knowledge-based and data-based open access battery
management system
• Increased traceability of raw materials and components in the battery value chain
• A digital twin of the manufacturing process: manipulating the complete virtual
representation can actuate the physical world, improving the control of manufacturing
facilities and processes
To accelerate the establishment of a globally competitive Indian EV and battery industry and
to drive the implementation of EV and battery-related research and innovation actions, the
following key actions would need to be focused upon.
Moreover, EVs will have complex proprietary software. In fact, software features are likely to be
differentiating factors in a consumer’s purchase decision. While hardware upgrades are slow
and difficult, regular software upgrades are easily achievable through over the air updates. To
stay competitive, auto supply chains need to focus on continuous software development and
hence focused R&D in areas such as decoupling software – hardware development cycles is
essential for faster deployment. While India has a naturally good starting point in automobile
software development, incentivizing development of proprietary EV software will be crucial to
ensure momentum. 71Proposed Reforms and Roadmap for India
Exhibit 40: Proposed governance structure and operating model
General Assembly
1
(long list of members) Executive
Committee
• Appointed by the GA
• Represents the pvt. side in the board
• Discussion and decision on joint
• strategy
Governing board / Sponsors
Industry-Academia delegates
(Select nominated / sponsor members)
Government delegates
OEMs, Universities, Research
Institutes, Startups
• Appointed by the GA
3
for overall
mgmt. of the initiative
• Submits strategy and work
proposal to the GA
3
• Follows the resolutions,
instructions & recommendations
adopted by the Governing Board
• Across 6 key roles
2
• Organizing work and achieving
consortium’s objectives
Technical
working
groups
1. Illustrative list of members on subsequent slide 2. Illustrative roles enlisted on subsequent slide 3. General Assembly (GA) 4.
Executive Committee (EC) 5. Governing Board (GB)w
The unified body could approach the following players, for creating a stellar network of joint
R&D partners, to join the General Assembly.
1
2
3
Foreign and local universities/ Research Institutes (E.g.. Council of Scientific and Industrial
Research - Central Electro Chemical Research Institute (CSIR-CECRI) | Indian Institutes
of Technology (IITs) | International Centre for Automotive Technology (I-CAT) | Karlsruhe
Institute of Technology
Industry players across the battery value chain Raw Materials, Processing, Cell
component manufacturing, Cell assembly, Battery component manufacturing and
assembly, Re-cycling, Charging Infra). For e.g.:
• OEMs – Ola Electric | TVS | Tata | Mahindra Electric | Hero Electric | Suzuki | Hyundai
• Cell components – Hindalco | GFL | Himadri | Epsilon | Daramic
• Battery manufacturing and assembly – LG Chem | Samsung| Panasonic | Amara Raja |
Exide | RIL | Rajesh Exports | BHEL
• Charging Infra – Exicom | Okaya | Amara Raja | Delta | Continental | BorgWarner,
Panasonic | Napino
• Battery start-ups – Inverted, | Gegadyne Energy | Lohum Cleantech | Ziptrax Cleantech,
Nexus battery | Ion Energy | Grinntech
Industry Associations (E.g.. Indian Energy Storage Alliance (IESA) | Indian Battery
Manufacturers Association (IBMA) | Indian Battery and Accessories Industries Welfare
Association (IBAIWA) | The Society of Indian Automobile Manufacturers (SIAM))
• Provides advice/ inputs on strategy to the GB
through its delegates
• Approves general policy on the basis of
proposals of the EC
Exhibit 41: Collaboration required between industry leaders, battery startups, local universities,
and leading international universities to drive cell & battery innovation (Illustrative list)
This intervention (Actions 10-12) could be operationalized through the following governance
structure and operating model, benchmarked based on global best practices. 72Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
The key roles of the technical working groups could be structured across the following 6
themes:
1. Raw materials & recycling - R&D activities across sustainable sourcing of raw materials
and recovering valuable metals and materials from end-of-life electronics
2. Advanced materials and manufacturing - R&D activities across advanced materials
(Cathode, Anode, Separator, Electrolyte materials) towards improving their performance
and reducing their cost
3. Accelerated discovery of next-gen battery interfaces and materials - R&D activities across
alternative battery technologies to provide the Indian battery industry with disruptive tools
and battery technologies to be developed in the long-term
4. Safety - R&D activities across developing battery safety – particularly the intrinsic safety of
the electrochemical components - to ensure the confidence in and widespread adoption of
e-mobility and electrical energy storage
5. Sustainability - R&D activities to ensure that the sustainability of batteries is developed
from a holistic perspective (economic, social, and environmental
• Co-ordination and project management - Reliable strategic coordination and alignment
across the value chain to create tangible economic impact from the R&D efforts
I. Context
India’s EV and EV component market is expected to gain huge momentum owing to the Auto
and Auto Component PLI, ACC PLI and other schemes launched here. Given the nascent stage
of India’s EV and battery market, India presently lacks the skilled expertise and technical know-
how required for producing most of the components. Globally, governments are stepping in to
drive creation of a future ready battery workforce. E.g., EC launched The Alliance for Batteries
Technology, Training and Skills (ALBATTS) for syncing new skills demand with supply of
education and training in battery sector.
There is a need to re-skill and up-skill local workforce in key battery and EV component skills
such as inorganic and organic chemistry, expertise in surface mounting technology (SMT),
Separator coating process know-how, electrochemical techniques, etc. Based on our analysis,
given local EV demand of 11-13 Mn units/ year by 2030, we estimate that at least 200,000 to
250,000 people would need to be skilled by 2030 for manufacturing roles across the EV value
chain (cell component manufacturing, cell assembly, battery assembly, manufacturing of
e-motors, power electronics, charging infrastructure, and high voltage EV cables, and EV
assembly). While specialized skilling programs are taking place in pockets (E.g., IIT Madras has
started a 12-week online certification course focused on EV), a government orchestrated, and
industry-academia led, central program is required to ensure standardization of curriculum,
contributing to consistently high-quality workforce. To support India’s high ambition for
electrification of transport by 2030, it is critical to centrally design a blueprint for competences
and training schemes of the future in collaboration with key EV and battery stakeholders.
Thrust Area 4 - Facilitate industry-academia collaboration for re-skilling and up-skilling
the Indian workforce in line with skills and competencies needed to emerge as a leader in
the growing Battery & EV manufacturing ecosystem
III. Expected Impact
• Well-coordinated Indian research initiative gathering excellent scientists and innovators
and paving the way to industrial exploitation of future battery technologies
• Advanced batteries delivering on cost, performance, safety, and sustainability with clear
prospects for cost competitive large-scale manufacturing
• Industrial readiness in alternate battery technologies providing India with key leadership
opportunities
• Improved prototyping and safe testing infra along with financial incentives for developing
prototypes and for first commercial industrialization 73Proposed Reforms and Roadmap for India
II. Proposed Initiatives (Actions 13 to 16)
#13 - Develop existing infrastructure and faculty skillset to enable Battery & EV skill
development amongst students
#14 – Design curated curriculum for skilling new age EV and battery workforce
Feedback from industry indicates that obsolete skillsets are being created due to training
performed on outdated machines/softwares in universities. There is a need of upgrading
equipment, partly funded by government and partly by industry players, to ensure best in
class infrastructure for enabling EV & Battery skill development amongst students. Further,
investments would need to be made in training the faculty to ensure impartation of requisite
new-age battery and EV skills.
The new wave of e-mobility initiatives will result in a swathe of requirements for new age skills
and opportunities for employment. Successful planning and execution of these initiatives will
depend on the available capacity in terms of both personnel & skills. In India, multiple bodies
offer capacity building programs, and these efforts need to be synchronized for effective
outcomes. There is a critical need for a centralized task force covering multiple dimensions
of up-skilling & re-skilling across the e-mobility value chain, at central and state level. Given
Automotive Skill Development Council’s (ASDC) relevant expertise in this area, ASDC, under
the aegis of the Directorate General of Training (DGT), could provide guidance and inputs on
leading this centralized task force.
A skill-gap assessment would need to be conducted (similar to the one ASDC conducted
in 2019 for the Automotive sector). This would involve baselining existing skill sets and
relevant battery courses in India and holding industry consultations to understand modern
requirements for skills and job roles. Partnerships could be formed with a few leading OEMs
(E.g., Tata Motors, Mahindra, etc.) who could anchor the industry consultation process. The
inputs from industry would be crucial in determining the extent of re-skilling required and
the extent of up-skilling required across various functions (E.g., manufacturing, research
and development, operations, and maintenance/ servicing, etc.). Once the bifurcation has
been made across re-skilling and up-skilling needs, skill sets emerging through the skill gap
assessment would need to be compared against existing National Occupational Standards
(NOS), to identify need for development of new NOS. Expert groups involving industry and
academia would need to be formed to define curriculum requirements across each skilling
need – E.g. Duration of module, National Skill Qualification Framework (NSQF) level, mode of
learning and training, eligibility criteria, learning outcomes, assessment criteria, etc.
This exercise will require close collaboration across inter-ministerial departments as the
curriculum would need to be designed across Universities, ITIs, Polytechnics, and VETs.
Based on interviews with multiple industry experts, below is an illustrative initial list of skills and
knowledge that would be required:
Illustrative, based on industry expert interviews
Initial list of skills/knowledge required
• Advanced inorganic and organic chemistry
• Slurry preparation and coating
• Electrode drying and calendering
• Expertise in SMT
• Separator coating process know-how
• Skill to control pH levels of acid, voltage and RPM of drums for manufacturing copper foil
• Technical skills like smelting, rolling, welding
• Electrochemical techniques such as cyclic voltammetry, electrochemical impedance
spectroscopy
Exhibit 42: Initial list of skills / knowledge required 74Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Once the skill-gap assessment is completed by the centralized task force and the exact re-
skilling and up-skilling requirements have been detailed out, the course curriculum would need
to be designed and/or refreshed as required, in consultation with universities, academicians,
training institutions, VET centers, battery manufacturers and OEMs. E.g., ASDC partnered with
Hero MotoCorp for designing 2W short-term training course. This will drive standardization
of curriculum across institutions to ensure high and consistent quality of workforce. Once
the course curriculum has been designed/ revamped, it would need to be integrated across
existing degree, diploma, certification, or training programs by Universities, ITIs, Polytechnics,
and VETs.
To create a successful industry-academia collaboration for up-skilling the workforce, ASDC
would need to expand its network and forge partnerships across the EV & battery value chain.
An illustrative list of key players that may be approached for skilling partnerships has been
detailed in Exhibit 41
Additionally, to ensure global knowledge transfer for EV and battery value chain, ASDC can
promote collaboration with leading international universities offering new-age courses.
Stanford University
Delft University
of Technology
Oxford Brooks University
Focus areas:
• Battery system design
specifications
• Battery cell design
• Battery cell modeling
• Battery management
systems (BMS)
• Battery degradation
modeling and health-
conscious control
• Power electronics
interfaces
• Battery system thermal
management
• Battery system safety
• Battery system design
for EVs
• EV charging networks
• Battery systems for
the grid
• Battery life cycle value
Focus areas (Electric Cars:
Technology)
• Operation principle of
electric cars
• Motors and power
electronics in an
electric cars
• Battery technology
• Relevant charging
infrastructure
technologies and
innovations, such as
smart charging
• Future technology for EVs
such as wireless charging
and solar EVs
Focus areas:
• Noise, Vibration and
Harshness
• Advanced Powertrain
Engineering
• Engineering Business
Management
• Advanced Vehicle
Dynamics
• Advanced Vehicle
Propulsion
• Engine and powertrain
modelling
Exhibit 43: International Universities offering e-mobility courses
Lastly, talent absorption programs via internships/placements into Battery/ EV manufacturing,
would need to be set-up, in collaboration with Industry.
• Familiarity with physicochemical properties of electrolyte measurement, such as HF, density,
viscosity, conductivity, etc.
• Material sciences and Electrochemistry (E.g. Cell design and formation cycles, battery component
combinations’ optimization, etc.)
• HV electrical/Power Electronics (Electrical circuitry, PCBA design, microprocessor design, etc.)
• Software development (Electrochemical modeling, Telemetric programming experience (BMS
development), etc.)
• Thermal Management (E.g. Heat distribution physics, Electrode-drying technology, etc.)
• Mechanical/Structural Design (E.g. Fluid dynamics (Hypermesh and Star-CCM+), Testing and
troubleshooting electro-mechanical systems (FEA, FMEA, 8D, APQP), etc.) 75Proposed Reforms and Roadmap for India
#15 - Work with technology partners to design on-demand ‘Phygital’ learning courses for
up-skilling existing workforce
Based on the skill-gap assessment results from initiative 14 above and the key inputs received
from industry-academia, it would also be important to create on-demand ‘Phygital’ learning
courses to fill knowledge and skill gaps of existing workforce in the battery and automotive
industry. E.g. ASDC partnered with TCS iON for designing ‘phygital’ learning courses to up-skill
existing workforce in the Automotive sector. The recently announced DESH-Stack e-portal for
boosting skill development and digital infrastructure may also be leveraged for this initiative.
To operationalize this intervention, the following four key roles would need to be performed:
i. Gathering Sectoral Intelligence - Identify current and future skills required for development
of batteries, in collaboration with key industry and academic players.
ii. Facilitating Training & Education - Develop designs for courses, define and make education
setups for new work roles, and make solutions for addressing individual knowledge and
skills gaps in an effective way.
iii. Publicity & dissemination - Ensure the appropriate visibility and wide dissemination of
the work of this initiative through establishment of a stakeholder’s database, creation of a
social media strategy, etc.
iv. Project Management, implementation, and evaluation - Ensure the project is conducted
on time, according to the budget and directed towards the overall project objective; Ensure
smooth integration/ implementation across universities and other learning institutes
#16 - Set-up Centers of Excellence in reputed universities, in collaboration with OEMs and
key cell / battery manufacturers
Centers of Excellence (CoE) can be set up at premier institutes to offer specialized programs
in collaboration with industry partners. Partner institutes would need to be identified. The
government could provide viability gap funding (if required) to partner institutes to develop
land and infrastructure for CoE. Further, ASDC could tap into its member network to provide
networking support to help institutes pitch CoE to industry players. The CoE would work with
industry partner(s) to define the curriculum (duration, modules, etc.), that would be directly
relevant for industry placement of students. E.g. RV College of Engineering, Bangalore (RVCE)
set up a CoE in collaboration with Mercedes Benz to offer an advanced diploma in Automotive
Mechatronics.
Exhibit 44: Case study: RVCE-Mercedes Benz advanced diploma in automotive mechatronics
Curriculum
1-year program with 5 modules spanning mechanics, electronics, advanced automotive
systems, soft skills, and a workshop module with Mercedes
Setup
Mercedes is involved in planning the syllabus, development of training labs equipped with its
cars, supply of tools & equipment, and training of faculty
Exposure
Regular interaction with experts from Mercedes Benz through guest sessions, industrial visits,
and webinars
Outcome
Students awarded with globally valid diploma and secured placements across Mercedes
Benz, Volvo, Bosch, and EV start-ups
RVCE - Mercedes Benz advanced diploma in automotive mechatronics 76Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
III. Expected Impact
• Provision of future ready, skilled workforce for the EV and battery players to support the
growth of this sector
• Clear blueprint of the skills/ competencies needed for emerging job roles in the EV and
battery sector and India’s starting point against each
• On-demand ‘Phygital’ learning & training courses available at scale to up-skill existing
workforce
• Integration of new curricula and certifications in the national frameworks
• Creation of a sustainable industry-academia partnership in this emerging economic sector
4.2.1 Key activities
While the previous section covered the need for, scope of and expected impact from the
proposed interventions, the ensuing paragraphs summarize the key activities that need to be
focused on to make each of the 4 interventions a success.
Thrust Area 1 - Enable EV component manufacturing at scale by creating an enabling
eco-system and a level-playing field for select high priority components
In order to achieve high scale manufacturing of EV components, it is vital to develop Hi-Tech
EV component corridors along existing auto belts in partnership with the governments. Firstly,
suitable auto belts have to be identified and with the help of corresponding state governments,
appropriate land has to be earmarked to build the corridors. Relevant stakeholders and anchor
investors have to be identified and onboarded. EV corridors need to be equipped with plug-
and-play production facilities and other shared infrastructure for the eco-system players.
Financing support is crucial to set up a strong EV eco-system due to intensive capital
requirements especially for CAM, AAM, Copper foil & Separators. Partner banks need to be
identified for securing green financing commitments towards greenfield large-scale projects
and particulars (E.g., percentage commitment, terms, eligibility, etc.) have to be worked out.
Levers to offset structural unit cost disadvantage across identified components need to be
finalized (e.g., import duty relief for import of PCAM (raw material)). Relevant central and state
government agencies have to work together to implement the identified levers.
New opportunities to attract greenfield project investments in select high priority cell
components (i.e., CAM NMC, AAM, Copper foil & Separators), where need-gap exists despite
the PLI schemes, need to be explored. Committees with representatives from states would
need to be set up to detail the specifics on channelizing existing schemes for providing capital
incentive packages. Competitive incentive packages need to be rolled out while ensuring
transparent disbursal process.
Localization mandates are essential to accelerate the set-up of EVSE component
manufacturing & assembly in India. Committee to be set up to detail specifics on localization
criteria and selection mechanism. Mandates have to be rolled-out while ensuring adherence
to tender criteria by DHI and state nodal agencies for PCS. Post completion of PMP deadlines,
localization criteria need to be re-assessed.
4.2 Conclusion and Way Forward 77Proposed Reforms and Roadmap for India
Thrust Area 3 - Foster centrally coordinated multi-stakeholder efforts for R&D in EV
innovation
Thrust Area 2 - Ensure consistent availability of critical & strategic EV raw materials to
strengthen mineral security of the nation
To ensure mineral security of key battery raw materials, an agile and inclusive stakeholder
consultation process needs to be established that can identify bottlenecks such as
regulations, permits or operating licenses across the raw materials’ (RMs) value chain. Global
primary sources (mining) and secondary sources (re-cycling) of critical RMs need to be
identified and strategic trade partnerships with resource-rich countries need to be executed.
Ministry directive to drive IREL’s focus towards Neodymium mining needs to be secured to
produce rare earth permanent magnets in India. Viability gap funding has to be provided
as required while setting up the mining facilities. In addition, exploration of alternate sources
(e.g., carbonatite reserves) of Neodymium needs to be incentivized.
Setting up of Raw Materials Investment Platform (RMIP) helps in leveraging investments
(JVs). A digital platform needs to be set up where prioritized RM projects would then be listed.
Investor-investee matchmaking for the pipeline projects would need to be monitored and
supported through the platform.
Sustainability standards and certification schemes have to be established to ensure high
quality and sustainable output by domestic players & to promote ethical sourcing and
transparency in the value chain. Committee for setting the minimum standards across
RMs has to be formed that would benchmarks global best practices across critical RMs.
Additionally, downstream players have to be consulted with and aligned on certification
framework.
EV & battery specific research needs to be promoted through industry outreach and raising
awareness of R&D activities. There is a need to understand the current extent of challenges
in R&D faced by industry, start-ups and universities across India and expand the industry-
academia-startup consortiums to aid in increased collaboration. An R&D roadmap with short,
medium term priorities like reducing battery costs, enhancing battery safety, increasing battery
density, cycle life, charge rate, recovery of metals and recycling, and long-term priorities like
improved traceability of components in battery value chain, self-healing batteries, novel
chemistries, solid state batteries, creation of autonomous ‘self-driving labs’ for experiments on
the fly, developing a shared and interoperable data infrastructure for battery materials, real
time data based open access BMS and digital twins for cell manufacturing; needs to be laid
out to solidify India’s strategic research agenda.
EV and Battery innovation hubs in reputed institutions have to be developed through
appropriate funding. Innovation labs, in identified partner institutes, providing testing and
prototyping infrastructure to be set-up to drive strategic research across identified focus areas.
Linkages with other researchers will aid collaboration and reduce barriers to commercialization.
Innovation platform to host identified R&D projects to be developed that serves as a gateway
for interested stakeholders to take part.
Collaborative research between industry, academia, and start-ups and R&D projects across
identified priority areas need to be incentivized which will aid in speeding up commercialization
of new R&D findings. EV software features are key differentiators for customers and given
their complexity in EVs, decoupling hardware and software development and incentivizing
development of proprietary EV software will be helpful. Dedicated funding pool for carrying out
R&D projects needs to be set-up to support selected ventures. 78Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Existing infrastructure including machines, software, other training infra across universities/
institutes needs to be upgraded as necessary. Faculty of institutes to be equipped with
requisite battery/EV skills through a set of dedicated training programs to ultimately enable
EV skill development amongst students. Some of the skills and knowledge required will include
– knowledge on advanced inorganic and organic chemistry, electrochemistry and material
sciences, HV electrical and power electronics, software development, thermal management
and mechanical and structural designs of a battery as well as skills to control process
parameters and precision manufacturing of cells, expertise in SMT and technical skills like
smelting, rolling and welding.
Curated curriculum to be designed for skilling new age EV and battery workforce. Industry
outreach and industry-academia consortium expansion is crucial to raise awareness of skill’
agenda. Skill-gap assessment has to be carried out to finalize courses to be offered in higher-
degree university programs. This includes revamping diploma/certification programs to be
included in ITIs / VET centers / Polytechnics. Additionally, MoUs have to be signed with industry
players to design internship/placement programs for students undergoing industry approved
curriculum.
‘Phygital’ learning courses for up-skilling existing workforce to be created with the help of
technology partners. After assessment of skill-gap, suitable technology partner(s) need to be
onboarded for creating ‘Phygital’ content that needs to be updated with on-demand learning
modules based on inputs received from industry-academia. The role of industry outreach
and industry-academia consortium expansion is essential to support the process and drive
awareness of skills’ agenda. Reputed universities should be partnered with to set-up centers
of excellence (COE) in collaboration with OEMs and key cell/battery manufacturers. After
identifying partner institutes, the institutes should also be enabled to pitch COE to leading
industry players for forging partnerships. Dedicated learning & training modules need to be
created by the COE. To realize India’s mission of becoming a globally competitive powerhouse
in battery & EV manufacturing, it is imperative to have a holistic strategy to drive concerted
localization across the EV value chain. If the proposed actions across these 4 key thrust areas
(in addition to ongoing efforts) are executed effectively, the results can be transformative for
India’s e-mobility landscape. It will not only accelerate local EV adoption, but also put India
on the roadmap for developing a competitive and self-sufficient domestic manufacturing
ecosystem for electric mobility.
Thrust Area 4 - Facilitate industry-academia collaboration for re-skilling and up-skilling
the Indian workforce in line with skills and competencies needed to emerge as a leader in
the growing Battery & EV manufacturing ecosystem 79Proposed Reforms and Roadmap for India
4.2.2 Action roadmap
For each of the proposed initiatives, a high-level roadmap of key activities has been created
that would need to be carried out to make the initiative a success.
Proposed Initiative & Key Activities
Year 3
Onwards
Year 2Year 1
Develop Hi-Tech EV component corridors, along existing auto belts, in partnership with state governments
Green financing commitment from banks for supporting large-scale greenfield project investment in
India (especially for CAM, AAM, Copper Foil & Separators)
Provide support to offset structural unit cost disadvantages for production in India, esp. for CAM (e.g.,
import duty relief for import of PCAM (RM), etc.)
Explore opportunities to attract greenfield project investments in select high priority cell components (i.e.,
CAM NMC, AAM, Copper Foil & Separators) where need-gap still exists despite the PLI schemes
1
2
3
4
Identify suitable auto belts (and corresponding states)
for the set up EV component corridor(s)
Work with state governments to identify and earmark
land for EV component corridor
Onboard stakeholders/ anchor investors
Build plug-and-play production facilities
Set up shared infra in EV component corridor
Identify partner banks
Work with banks to set up green financing programs
(design contours, terms, eligibility, etc)
Finalize levers to offset structural unit cost disadvantage
across identified components
Work with relevant central / state govt agencies to
implement the identified levers
Set up committee with representatives from states to
detail specifics on channelizing existing schemes for
providing capital incentive packages
Roll-out competitive incentive packages and ensure
transparent disbursal process
Consider localization mandates to accelerate set up of EVSE component manufacturing & assembly in
India
5
Set up committee to detail specifics on localization
criteria and selection mechanism
Roll-out and ensure adherence to tender criteria by DHI
and State Nodal Agencies for PCS
Re-assess localization criteria post completion of PMP
deadlines 80Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
Ensure mineral security of key battery raw materials
Enable mining of Neodymium in India for producing permanent magnets
Set up a Raw Materials Investment Platform (RMIP) to help leverage investment (JVs) in a pipeline of key
projects
Establish sustainability standard and certification scheme to ensure high quality and sustainable output by
domestic players & promote ethical sourcing and transparency in value chain by enforcing the respective
standards
6
7
8
9
Establish an agile and inclusive stakeholder consultation
process to identify bottlenecks such as regulations,
permits or operating licenses across the raw material
RMS value chain
Identify global primary sources (mining) and secondary
sources (re-cycling) of critical RMs
Drive strategic trade partnerships with resource-rich
countries
Secure Ministry directive to drive IREL’s focus towards
Neodymium mining
Provide viability gap funding as required
Set-up Nd mining facility
Incentivize exploration of alternate sources
(E.g., carbonatite reserves) of Neodymium
Set up digital platform
List prioritized RM projects on the platform
Initiate Investor-Investee matchmaking for projects
Form Committee for setting certifications standards
across RMs
Benchmark global best practices for standards and
certification across critical RMs
Consult with downstream players to align on
certification framework
Formulate minimum standards to be followed across RM
value chain by domestic players
Proposed Initiative & Key Activities
Year 3
Onwards
Year 2Year 1
Develop India’s EV & battery specific strategic research agenda covering short-, medium- and long-term
R&D priorities
10
Industry outreach and raising awareness of R&D
activities
Understand extent and challenges in R&D in India across
start-ups, universities, and industry
Expand consortium of industry-academia-startups and
identify key R&D priorities 81Overview of EV Adoption in India
Provide funding to develop the required infrastructure for EV and Battery Innovation hubs within reputed
institutions, to promote collaborative research
Provide incentives to industry, academia, and start-ups to conduct collaborative research
Develop existing infrastructure and faculty skillset to enable Battery & EV skill development amongst
students
Identify partner institutes
Setup innovation labs providing testing and
prototyping infrastructure
Set up Innovation Platform to host identified R&D
projects and list projects on the Platform
Application by stakeholders for open R&D projects of
interest
Strategic research across identified focus areas
Create a General Assembly consisting of Industry players
across value chain, foreign and local Universities and
research institutes, start ups and industry organizations
Set-up dedicated pool of funds for carrying out R&D
in battery/EV and for prototype/commercial product
testing.
Create incentive program for R&D projects laid out as
national priorities and for development of proprietary EV
software
Decision on R&D projects to be funded
Conduct study to understand key machines/
technology/ softwares required
Upgrade machines, softwares, other training infra
across Universities/ Institutes
Launch training programs for faculty in line with
requisite battery/ EV skills
11
12
13
Design curated curriculum for skilling new age EV and battery workforce14
Proposed Initiative & Key Activities
Year 3
Onwards
Year 2Year 1
Form a centralized task force for leading this initiative
Form partnerships with a few leading OEMS (Eg.
Tata Motors, Mahindra, etc) to anchor the industry
consultation process
Expand consortium of industry-academia players to
define curriculum requirements across each skilling
need (E.g. NSQF level, learning outcomes, etc)
Task force to complete skill-gap assessment
Identify need for development of new NOS (basis skill
gap assessment)
Lay out national EV and battery specific research
agenda covering short-, medium- and long-term R&D
priorities, fostered centrally through existing set-ups 82Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
References
44. https://erma.eu/
45. ERMA’s “Rare Earth Magnets and Motors: A European Call for Action”
46. https://www.businessinsider.in/policy/economy/news/heres-how-india-can-end-chinese-dominance-in-rare-earths/
articleshow/80883001.cms
47. https://pib.gov.in/PressReleasePage.aspx?PRID=1581058, KABIL set up to ensure supply of critical minerals, Aug 2019
48. https://dst.gov.in/dhi-dst-technology-platform-electric-mobility-tpem
49. https://heavyindustries.gov.in/writereaddata/UploadFile/EoI%20EV%20Charging.pdf
50. https://heavyindustries.gov.in/writereaddata/fame/famedepository/1-pmp.pdf
To realize India’s mission of becoming a globally competitive powerhouse in battery & EV
manufacturing, it is imperative to have a holistic strategy to drive concerted localization
across the EV value chain. If the proposed actions across these 4 key thrust areas (in addition
to ongoing efforts) are executed effectively, the results can be transformative for India’s
e-mobility landscape. It will not only accelerate local EV adoption, but also put India on the
roadmap for developing a competitive and self-sufficient domestic manufacturing ecosystem
for electric mobility.
Work with technology partners to design on-demand ‘Phygital’ learning courses for up-skilling existing
workforce
Set-up centers of excellence in reputed universities, in collaboration with OEMs and key cell / battery
manufacturers
Industry outreach and raising awareness of skills’
agenda
Expand consortium of industry-academia players
Skill-gap assessment completed
Identify technology partner for creating Phygital
learning content
Create on-demand learning modules based on
inputs received from industry-academia
Identify premier institutes for setting up COE
Enable institutes to pitch CoE to industry
players, identify industry partner(s)
Create learning & training modules
15
16
Proposed Initiative & Key Activities
Year 3
Onwards
Year 2Year 1
Define curriculum requirements for each skilling need.
(E.g. Course duration, mode of learning, eligibility
criteria, assessment criteria, etc)
Finalize courses to be included in higher-degree
university program
Revamp diploma/ certification programs to be
included in ITIs/VET centers/ Polytechnics
Integrate new/ revamped curriculum in degree/
diploma/ certification framework
Conclude MoUs with industry members for internship/
placement support for students undergoing
industryapproved curriculum 83Proposed Reforms and Roadmap for India
Full FormAcronym
AAM
AC
ACC
ALBATTS
APQP
ARAI
ASDC
ASPIRE
BCD
BEE
BMS
BOM
bps
BSS
BWMR
CAFC
CAFE
CAM
CAN
C-BEEV
CBU
CCS
CECRI
CNS
CoBE
CoE
CoP
CPO
CSIR
DAE
DC
DHI
DRIVES
DST
EBA
EC
ELV
EPA
Anode Active Material
Alternating Current
Advanced Chemistry Cells
The Alliance for Batteries Technology, Training and Skills
Advanced Product Quality Planning
Automotive Research Association of India
Automotive Skills Development Council
Automotive Solutions Portal for Industry Research & Education
Basic Customs Duty
Bureau of Energy Efficiency
Battery Management System
Bill Of Material
Basis points
Battery Swapping Stations
Battery Waste Management Rules
Corporate Average Fuel Consumption
Corporate Average Fuel Economy
Cathode Active Material
Controller Area Network
Centre for Battery Engineering and Electric Vehicles
Completely Built Up
Combined Charging Cystem
Central Electro Chemical Research Institute
Chinese National Standard
Centre of Battery Engineering
Centre of Excellence
Conference of the Parties
Charge Point Operator
Council Of Scientific and Industrial Research
Department of Atomic Energy
Direct Current
Department of Heavy Industries
Development & Research on Innovative Vocational Education Skills
Department of Science & Technology
European Battery Alliance
European Commission
End-of-life vehicle
Environmental Protection Administration 84Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain
ERMA
ETP
EU
EV
EVCIPA
EVSE
EXIM
FAME
FEA
FMEA
GB/T
HMI
IBAIWA
IBMA
iCAT
ICE
IEC
IESA
IGBT
IIT
IM
IPCEI
IREL
ISO/TC
ITI
JV
KABIL
MHI
MOQ
MOSFET
MSME
MSP
NEDC
NMC
OEM
O&M
PCBA
PCS
PLI
PMP
RM
European Raw Materials Alliance
Effluent Treatment Plant
European Union
Electric Vehicle
Electric Vehicle Charging Infrastructure Promotion Alliance
Electric Vehicle Supply Equipment
Export-Import
Faster Adoption and Manufacturing of Electric and Hybrid Vehicles
Finite Element Analysis
Failure Mode and Effects Analysis
Guo Biao / Tuijian (Chinese recommended national standard)
Human-Machine Interface
Indian Batteries and Accessories Industries Welfare Association
Indian Battery Manufacturers Association
The International Center for Automotive Technology
Internal Combustion Engine
International Electrotechnical Commission
Indian Energy Storage Alliance
Insulated Gate Bipolar Transistor
Indian Institute of Technology
Induction Motor
Important Projects of Common European Interest
Indian Rare Earths Ltd.
International Organization for Standardization / Technical Committee
Industrial Training Institute
Joint Venture
Khanij Bidesh India Ltd.
Ministry of Heavy Industries
Minimum Order Quantity
Metal-Oxide-Semiconductor Field-Effect Transistor
Micro, Small and Medium Enterprises
Mobility Service Provider
New European Driving Cycle
Nickel-Manganese-Cobalt
Original Equipment Manufacturer
Operations and Maintenance (costs)
Printed Circuit Board Assembly
Public Charging Stations
Production Linked Incentives
Phased Manufacturing Programme
Raw Material 85Proposed Reforms and Roadmap for India
RMIP
ROCE
ROI
SEZ
SG&A
SIAM
SKD
SMPS
SMT
STU
TMS
TCO
TRL
ULEZ
VET
Raw Materials Investment Platform
Return on Capital Employed
Rate of interest
Special Economic Zone
Selling, General and Administrative (costs)
Society of Indian Automobile Manufacturers
Semi Knocked Down
Switched-Mode Power Supply
Surface Mounted Technology
State Transport Undertakings
Thermal Management System
Total Cost of Ownership
Technology Readiness Level
Ultra-Low Emission Zone
Vocational Education and Training 86Promoting Clean Energy Usage Through Accelerated Localization of E-Mobility Value Chain