India's production of Lithium-Ion Batteries to Outstrip Domestic Demand by 2030
India's electric vehicle (EV) and Li-ion battery market are poised for significant growth in the coming years, with a projected worth of billions of dollars by 2030. This growth is driven by a 30% EV penetration scenario, large-scale domestic manufacturing efforts, and expanding renewable energy storage needs.
EV Sector to Create a Market Opportunity Worth INR 2 Lakh Crore
For the EV sector, India is projected to create a market opportunity exceeding INR 2 lakh crore (about USD 26 billion) for EV powertrains and batteries combined. This significant market growth aligns with plans to ramp up domestic manufacturing of batteries to capture high-value-add components and foster economic benefits, including job creation.
Robust Growth in Stationary Li-ion Storage Capacity
On the stationary applications side, India is set to add 30 GW of new energy storage capacity by mid-2027, incorporating battery energy storage systems (BESS) and pumped hydro storage. This signals strong demand growth but also competitive market dynamics, with expectations for evolving revenue models for storage projects based on capacity payments and energy arbitrage.
Global Trends Indicate Rapid Growth in Lithium-ion Battery Market
Globally, the lithium-ion battery market is also witnessing rapid growth. The battery anode market is forecasted to jump from USD 19 billion in 2025 to over USD 81 billion by 2030, largely driven by automotive (EV) and industrial uses. This market expansion is supported by technological advancements, supply chain optimization, and increasing global EV adoption.
India to Be a Major Emerging Market for Li-ion Batteries
By 2030, India is expected to be a major emerging market both in production capacity and demand for lithium-ion batteries for EVs and stationary applications. Strong policy support, manufacturing investments, and integration into global supply chains are driving this momentum.
Li-ion Battery Cell Segment to Attract Demand from Stationary Applications
The Li-ion battery cell segment is not limited to electric vehicles in India. It is also likely to attract demand from stationary applications, such as energy storage systems for renewable energy sources.
Localisation and Imports in the Li-ion Battery Cell Segment
Some localisation in the Li-ion battery cell segment in India is achieved through technology transfers or alliances with overseas players. However, India currently relies on imports to meet its Li-ion battery cell requirements, with China dominating the ecosystem in terms of raw material processing and manufacturing capacities.
Demand for Li-ion Battery Cells for EVs Expected to Increase
The demand for Li-ion battery cells for electric vehicles in India is expected to reach 11-13 GWh by the end of FY2025. By FY2030, this demand is projected to increase significantly to 60-65 GWh. Manufacturers have committed investments of Rs 75,000 crore to increase Li-ion battery capacities to 150 GWh by 2030.
Prices of Li-ion Battery Packs Expected to Decrease Further
Prices of lithium-ion battery packs are expected to decrease further as global Li-ion battery supply outpaces demand over the medium term. This decrease in cost, coupled with increasing demand, will likely make electric vehicles more affordable for Indian consumers.
In conclusion, India's EV battery market is set to grow exponentially over the next five years, driven by government support, increased product launches, and enhanced awareness. The market for stationary Li-ion storage capacity is also expected to grow robustly, potentially outpacing short-term demand. Global trends indicate rapid growth in the lithium-ion battery market, which will likely benefit India's industry and demand outlook. By 2030, India is expected to be a major emerging market for lithium-ion batteries, both in production capacity and demand for EVs and stationary applications.
- The Li-ion battery market growth is not limited to electric vehicles in India; it is also expected to attract demand from the energy storage systems sector for renewable energy sources.
- The Li-ion battery cell segment in India, which is crucial for both electric vehicles and stationary applications, is being supported by technological advancements, supply chain optimization, and increasing global EV adoption.
