India’s ACC battery PLI scheme faces delays as capacity installation remains slow, with supply chain dependence and regulatory uncertainty affecting execution.
India’s ambitious Advanced Chemistry Cell (ACC) battery Production Linked Incentive (PLI) scheme is witnessing slower-than-expected progress, raising concerns over the pace of domestic battery manufacturing.
The $2.13 billion ACC battery PLI scheme was launched to reduce India’s dependence on imported battery cells and strengthen local manufacturing capabilities. However, execution challenges continue to delay progress.
The Ministry of Heavy Industries had set January 1, 2025, as the deadline for commercial production under the scheme. While quarterly penalty notices have been issued to beneficiaries for missing installation timelines, no penalties have been realised so far as extension requests remain under consideration.
According to Economic Times, As of now, only 1.4 GWh of capacity has been installed, with production of around 40,000 cells per month underway from a single beneficiary, Ola Electric. Industry sources expect capacity additions to improve later this year, with Reliance Industries also expected to begin scaling operations.
Supply chain dependence remains one of the biggest hurdles, particularly in China for technology, capital equipment and critical raw materials such as lithium. Industry experts say these structural bottlenecks have slowed execution timelines significantly.
To address these challenges, the government is also working on a proposed $1.41 billion incentive scheme for battery components. The scheme aims to support domestic production of critical materials such as cathodes, anodes and copper foil separators.
Regulatory uncertainty surrounding Rajesh Exports has further complicated the rollout. The company’s battery-linked entity remains under scrutiny following interim observations by SEBI, including allegations involving circular fund routing worth $17.3 million, creating uncertainty around allocated capacity.
Industry experts believe faster localisation, stronger supply chains and timely policy support will be key to accelerating India’s battery manufacturing ambitions.
