KOLKATA (miningweekly.com) – The Indian government is working on a package of direct fiscal incentives before inviting bids from global majors to set up battery manufacturing plants in the country under its ‘Make in India’ programme.

Government sources say that a slew of subsidies will be put on the table before inviting bids from global battery manufacturers by December, with a target of creating 50 GWh of battery making capacity within the country and moving towards a target of 600 GWh capacity by 2025.

Initially, the government will invite bids to set up ten battery manufacturing facilities and each of these facilities will be offered fiscal incentives for a period of ten years, the sources say.

The incentives likely to be firmed up before bids are invited include 100% duty free imports of critical inputs like lithium and cobalt; higher depreciation allowances; specific tax rebates, although with a sunset clause incorporated in it; and incentives linked to indigenisation of production technologies for each battery manufacturing unit, which could be for powering electric vehicles, mobile phones and consumer electronic products.

However, even as the government steps up efforts to woo lithium- and cobalt-based battery-making technologies and investments from foreign majors, it is unconvinced as to whether such a move will be ideal in the long run, as it could lead to imported commodities, such as oil and natural gas, being supplemented by further imported inputs – lithium and cobalt.

Towards this end, it has set up the National Mission of Transformative Mobility and Battery Storage with representatives from various related Ministries to explore alternative battery technologies, such as chemistry cells and hydrogen fuel cells, and promote indigenous research and development.

Underlining the importance of not not confining itself to lithium and cobalt technology, imminent scientist and president of Jawaharlal Nehru Center of Advanced Scientific Research, C N R Rao in a recent statement said, “the market is currently attuned towards lithium fuel cells, but the element is not available in the country as also cobalt”.

“The government has correctly called for a move towards electric vehicles. I have no issue with that but we have no reserves of either lithium or cobalt and China having effectively taken control over Congo where cobalt is available in abundance, we have to shift towards sodium and hydrogen. We can also do magnesium fuel cells too but that is also in short supply,” Rao said.