India’s battery electric vehicle (BEV) sales have grown rapidly, with a compound annual growth rate of 62.5% from fiscal year (FY) 2019–20 to FY 2024–25. Yet this growth has not been matched by growth in domestic battery manufacturing and India’s battery cell demand is currently met almost entirely through imports. As BEV adoption accelerates further, battery imports may continue to grow if local battery manufacturing supply chains remain inadequate, even as reliance on imported petrol and diesel declines.

This study “India’s EV Transition: Impact of electric vehicle battery demand on import payments from 2024 to 2050” published by The International Council on Clean Transportation (ICCT), models India’s battery demand across all major on-road vehicle segments, including two-wheelers, three-wheelers, passenger cars, light commercial vehicles, buses, and trucks, from 2024 to 2050 under three BEV uptake scenarios. It then assesses how different levels of domestic battery manufacturing pathways could affect India’s combined oil and battery import payments. 

Key takeaways

  • Battery demand grows substantially as vehicle electrification increases. Annual battery demand reaches about 340 GWh in the Baseline scenario and 573 GWh in both the Momentum and Ambitious scenarios by 2050. Faster electrification brings much of that demand forward, particularly before 2040.  
  • Battery imports remain important in the near term. Domestic battery cell manufacturing is still at an early stage, meaning imports continue to play a significant role as battery demand grows. The different manufacturing pathways begin to diverge more substantially after 2030, with greater localization reducing battery import requirements over time.  
  • Electrification has the largest impact on India’s future import payments. Even with no domestic battery manufacturing, the combined oil and battery import bill in 2050 is about 39% lower under the Momentum scenario and 61% lower under the Ambitious scenario than under the Baseline scenario. This is because the reduction in oil imports substantially outweighs the additional cost of battery imports.
  • Domestic battery manufacturing provides additional savings. Across the least and most favorable cases modeled, India’s 2050 import bill differs by US$125 billion. About three-quarters of that difference, US$94 billion, comes from faster electrification, while US$31 billion comes from scaling domestic battery manufacturing. 

Access the full paper here