With zero payouts and missed targets, India’s battery PLI scheme reportedly struggles. Government plans review as Ola, Reliance and Rajesh Exports face delays and penalties.
The government’s ₹ 181 billion production-linked incentive (PLI) scheme for advanced chemistry cell (ACC) batteries appears to have failed to take off, according to a recent Mint report. There have been no disbursals recorded since its launch four years ago.
The Ministry of Heavy Industries (MHI) is now preparing a review to assess the bottlenecks, secure fresh investments, and ensure that promised battery storage capacities are utilised.
The scheme was designed to encourage domestic production of advanced battery technologies, crucial for electric vehicles, renewable energy storage, and reducing India’s reliance on Chinese imports.
Under the plan, incentives were to be awarded for 50 gigawatt-hour (GWh) of storage capacity by 2029. So far, the government has secured commitments for 40 GWh, but manufacturers have failed to meet targets, stalling progress.
“The 40 GWh Capacity is end-use agnostic and can be utilised for any application, including e-vehicles and Stationary Energy Storage Systems, apart from consumer electronics, rail, and defence. Further, 10GWh capacity has been earmarked for grid-scale stationary storage (GSSS) applications,” the Ministry mentioned in a release.
However, the report highlighted that there has been very little traction in the ACC PLI. Capacities that have developed are also very limited. Following this, there is going to be a review of the scheme.
Three companies: Ola Electric (20GWh), Reliance Industries (15GWh), and Rajesh Exports (5GWh), were awarded a combined 40GWh capacity. Yet, actual installations remain minimal.
Union Heavy Industries Minister H.D. Kumaraswamy told Mint in June that only 1.4 GWh has been installed by Ola Cell Technologies, while over 10 non-PLI firms are independently working on around 100GWh of capacity.
The scheme has also faced setbacks with penalties. All three beneficiaries were fined for failing to meet December 2024 investment milestones, with deductions from future incentives estimated at ₹1 billion.
Ola Electric’s chairman, Bhavish Aggarwal, acknowledged delays, stating in July that the company is in talks with the government to “relook” at timelines.
With India yet to commence large-scale manufacturing of high-performance lithium-ion cells, officials emphasise that developing local capacity is crucial. The upcoming review will be critical to ensuring India does not fall further behind in the global battery race.
