India’s ambition of becoming a global hub for making electric vehicles faces one major hurdle: its lack of access to lithium.
Home to some of the most polluted cities on the planet, the South Asian nation is pivoting toward new-energy vehicles to clean up its toxic air. But with meager resources of lithium, the mineral essential to make batteries for electric vehicles, it is having to scour for resources overseas.
India’s EV production will rely on imports from China of lithium chemicals used to make cathodes and battery cells, according to Jasmeet Singh Kalsi, director at Manikaran Power Ltd., which is exploring setting up India’s first lithium refinery. “China has a thriving lithium chemical, battery cathode, battery cell and EV supply chain. India has none.”
Prime Minister Narendra Modi’s administration unveiled a slew of measures in 2019 to promote the clean-energy vehicles, including a $1.4 billion plan to make India a manufacturing hub for EVs and cutting taxes to spur purchases.
While electric cars in India remain a small segment, with an estimated 3,000 sold in 2018 compared with the 3.4 million fossil fuel-powered cars in the same year, the nation is forecast become the fourth-largest market for EVs by 2040, when the segment will comprise nearly a third of all vehicles sales, according to BloombergNEF.
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