Context:
India’s Advanced Chemistry Cell (ACC) – Production Linked Incentive (PLI) Scheme, aimed at building domestic battery manufacturing capacity, faces delays and structural challenges.
Key Highlights:
- Scheme Overview
- Launched: October 2021
- Financial outlay: ₹18,100 crore
- Target: 50 GWh manufacturing capacity by 2026
- Commissioned as of Oct 2025: 1.4 GWh only
- Incentive Structure
- Maximum subsidy: ₹2,000 per kWh
- Minimum investment requirement: ₹1,100 crore
- Local value addition conditions:
- 25% within 2 years
- 60% within 5 years
- Selected Companies
- Ola Electric
- Reliance New Energy
- Rajesh Exports
- None had prior battery manufacturing expertise.
- Challenges Identified
- Visa delays for Chinese technical experts.
- Dependence on Chinese ACC technology.
- Weak domestic ecosystem for:
- Cell manufacturing
- Raw materials
- Zero incentives disbursed (as of Oct 2025).
- Target disbursement ₹2,900 crore not achieved.
Relevant Prelims Points:
- Advanced Chemistry Cell (ACC):
- Includes lithium-ion and next-generation battery technologies.
- PLI Scheme:
- Incentive based on incremental sales.
- Aims to boost domestic manufacturing.
- Gigawatt-hour (GWh):
- Unit measuring battery production capacity.
- Importance of ACC:
- Electric Vehicles (EVs)
- Renewable energy storage.
Relevant Mains Points:
- Strategic Autonomy in Clean Tech:
- Reducing dependence on China.
- Make in India & Energy Transition:
- Battery manufacturing critical for EV adoption.
- Technology & Skill Gap:
- Lack of ecosystem and expertise.
- Industrial Policy Challenges:
- Local value addition vs global supply chain realities.
- Climate Commitments:
- Battery capacity essential for renewable integration.
- Execution Deficit:
- Policy ambition vs implementation bottlenecks.
- Way Forward
- Facilitate technology transfer partnerships.
- Fast-track skilled visa approvals.
- Develop domestic raw material supply chains.
- Encourage joint ventures with global leaders.
- Strengthen R&D and workforce training.
UPSC Relevance:
- GS 3: Economy – Industrial Policy
- GS 3: Science & Technology – Energy Storage
- GS 3: Environment – Clean Energy Transition
- Prelims: PLI Scheme, ACC, EV ecosystem.