India is the world’s fifth-largest car market and has the potential to become a top-three market in the near future, with close to 40 billion customers needing mobility solutions by 2030. That’s one face of the coin. The other side is that the country needs a revolution in transportation. The current trajectory of adding more and more cars that run on expensive imported fuel and crowding already overcrowded cities suffering from infrastructure bottlenecks and intense air pollution is unworkable. The cities of India will drown. A transportation revolution will have many components: better “pedestrian accessibility,” public transportation, railways, roads, and better automobiles. Many of these “best cars” are likely to be electric.
The transition to electric mobility is a promising global strategy for decarbonizing the transport sector. India is among a handful of countries that supports the global EV30@30 campaign, which aims for at least 30 percent of new vehicle sales to be electric by 2030. Prime Minister Narendra Modi’s advocacy of five elements for climate change — “Panchamrit” — at the recently concluded COP26 in Glasgow is a commitment to the same. The PM espoused various ideas, like renewable energy catering to 50 percent of India’s energy needs, reducing carbon emission by 1 billion tonnes by 2030, and achieving net-zero by 2070, so that future generations can lead secure and prosperous lives.
India’s electric vehicle push will lead to brighter, greener future
The push for electric vehicles is driven by the global climate agenda set out in the Paris Agreement to reduce carbon emissions in order to limit global warming. It is also expected to help improve the overall energy security situation, as the country imports more than 80% of its overall crude oil needs, amounting to approximately $ 100 billion. The boost is also expected to play an important role in the local electric vehicle manufacturing industry for job creation. Additionally, through various grid support services, electric vehicles are expected to strengthen the grid and help accommodate increased penetration of renewable energy while maintaining a safe and stable operation of the grid.
Today’s global electric mobility revolution is defined by the rapid growth in electric vehicle (EV) adoption. It is estimated that two out of every hundred cars sold today are powered by electricity. This phenomenon is defined today by the rapid growth in the adoption of electric vehicles, with sales of electric vehicles for the year 2020 reaching 2.1 million. The global fleet of electric vehicles amounted to 8.0 million in 2020 and electric vehicles account for 1 percent of the world’s vehicle stock and 2.6 percent of global car sales. Falling battery costs and increased performance efficiency are driving demand for electric vehicles globally.
It is estimated that by 2020-30 India’s cumulative battery demand will be around 900-1100 GWh, but there are concerns about the absence of a battery manufacturing base in India, leading to a reliance exclusively on imports to meet demand. growing demand. According to government data, India imported more than $ 1 billion worth of lithium-ion cells in 2021, despite negligible penetration of electric vehicles and battery storage in the energy sector. While India has yet to seize the opportunity, global manufacturers are betting heavily on battery manufacturing and rapidly moving from gigafactories to terafactories.
With recent technological disruptions, battery storage has a great opportunity to promote sustainable development in the country, considering government initiatives to promote electric mobility and renewable energy (energy capacity target of 450 GW by 2030). With increasing levels of per capita income, there has been a huge demand for consumer electronics in the areas of mobile phones, UPS, laptops, power banks, etc. that require advanced chemistry batteries. This makes advanced battery manufacturing one of the greatest economic opportunities of the 21st century.
The Indian government has taken various steps to develop and promote the electric vehicle ecosystem in the country, ranging from the remodeled Faster Electric Vehicle Adoption and Manufacturing (FAME II) scheme (Rs 10,000 crore) to the side of the consumer up to Production Linked Incentives (PLI) for Advanced Chemistry Cell (ACC) (Rs 18,100 crore) for the supplier side, and finally the recently launched PLI scheme for automotive and automotive components (Rs 25,938 crore) for electric vehicle manufacturers.
Therefore, all these forward and backward integration mechanisms in the economy are expected to achieve solid growth in the coming years and will enable India to make a leap towards electric vehicles and hydrogen fuel cell vehicles environmentally. cleaner This will not only help the nation conserve foreign exchange, but it will also make India a world leader in electric vehicle manufacturing and better comply with the Paris Agreement on climate change.
The three schemes cumulatively expect an investment of approximately Rs 1,00,000 crore that will boost domestic manufacturing and also facilitate the creation of demand for electric vehicles and batteries along with the development of a complete domestic supply chain and foreign direct investment in the country. The program provides for a reduction of the oil import bill of approximately Rs 2 lakh crore and a replacement of the import bill of approximately Rs 1.5 lakh crore.!
I hope that the prime minister’s vision will spur both public agencies and private entrepreneurs to embark on a collaborative journey that will benefit the country.
