Advanced Chemistry Cell (ACC) Production Linked Incentive (PLI) scheme
Why in news?
Advanced Chemistry Cell (ACC) Production Linked Incentive (PLI) scheme, launched in October 2021 with an outlay of ₹18,100 crore, aims to build 50 GWh of domestic battery manufacturing capacity by 2026. However, as of early 2026, only 2.8% (1.4 GWh) of the target has been commissioned, mainly by Ola Electric, highlighting significant delays and challenges.
Objectives of the ACC-PLI Scheme
- Promote domestic manufacturing of advanced battery cells (lithium-ion and other next-gen chemistries).
- Reduce dependence on imports, especially from China.
- Support EV adoption and renewable energy storage by ensuring local supply of high-quality cells.
- Create 50 GWh of capacity within five years after a two-year gestation period.
- Encourage large-scale investment: minimum ₹1,125 crore per participant.
Key Features
- Total outlay: ₹18,100 crore.
- Capacity target: 50 GWh by 2026.
- Milestones:
- Milestone 1 (2 years): ₹225 crore investment per GWh + 25% value addition.
- Milestone 2 (5 years): 60% value addition.
- Implementing Ministry: Ministry of Heavy Industries (MHI).
Challenges
- Delays in visa approvals for foreign technical experts (especially Chinese specialists).
- Technology gaps: lack of access to critical cell chemistries.
- Slow investment realization despite strong initial interest.
- Policy execution hurdles: stringent local manufacturing requirements.
Implications
- EV ecosystem risk: India’s ambitious EV adoption goals may face supply chain bottlenecks.
- Energy security concerns: continued reliance on imported cells undermines strategic autonomy.
- Industrial competitiveness: lagging behind global leaders in battery manufacturing.
Way Forward
- Streamline approvals for foreign expertise and technology transfer.
- Strengthen R&D in indigenous chemistries beyond lithium-ion.
- Enhance financial incentives to attract faster investment.
- Public-private collaboration to accelerate gigafactory commissioning.
Download Pdf
