The study also suggested enhancing environmental regulations for the manufacturing and disposal of electric vehicles to reduce their carbon footprint and mitigate other adverse impacts of EV production.
In an engaging statement released on Friday, the Global Trade Research Initiative (GTRI) recommended shifting the focus of the production-linked incentive (PLI) scheme towards the manufacturing of electric vehicle (EV) cells, specifically lithium-ion cells, rather than batteries. They argue that this step is crucial because the majority of the value addition in EV manufacturing occurs at the cell production stage.
Moreover, GTRI suggested that the Indian government should refrain from providing external subsidies to the domestic EV industry. They believe that this approach will prevent India from becoming overly dependent on China in the EV sector, which they referred to as becoming an “EV colony” of China.).
The founder of GTRI, Ajay Srivastava, was quoted by ET emphasizing that many firms in India lack the expertise to produce cells from basic materials. Instead, these firms import pre-made cells and simply assemble them into batteries, which he described as merely “superficial assembly work.” Srivastava criticized the current support for these practices under the PLI as promoting unsustainable operations.
He also pointed out that the existing schemes aimed at fostering advanced chemistry cell battery manufacturing have not yielded commercially viable results.
The report highlighted significant shifts in the global EV industry landscape, noting that major markets like the United States, the European Union, and Canada have implemented stringent taxes and restrictions on imports of EVs and components from China. These regions represent more than half of China’s global electric vehicle exports, the research noted.
Additionally, the think tank recommended that the government should invest in infrastructure for battery recycling and promote the use of renewable energy sources at EV charging stations. They also called for stricter environmental regulations for the manufacturing and disposal of EVs to mitigate their carbon footprint and other environmental impacts.
The research further suggested that accelerating the shift towards a cleaner energy mix and incorporating more renewable sources such as solar and wind could reduce the carbon intensity of the power used to charge electric vehicles.
Finally, the think tank advocated for a comprehensive approach to sustainability by evaluating the entire lifecycle environmental impact of EVs—from production through disposal—to minimize carbon emissions and reduce environmental damage.
