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Tata to build Gigafactory for lithium-ion cells in Gujarat

Jingyue Hsiao, DIGITIMES Asia, Taipei 0

Credit: AFP

Tata Group signed an MoU with India's western state of Gujarat to build a gigafactory for lithium-ion cells as EV sales have been increasing in India in recent years.

According to Mint and Business Standard, Agratas Energy Storage Solutions, Tata Group's subsidiary, signed an MoU with the government of Gujarat to set up a lithium-ion battery cell factory in Sanand. Tata will initially invest INR130 billion (US$1.6 billion) and targets an annual production capacity of 20GWh, generating direct and indirect jobs for 13,000 people. The annual production capacity is expected to be doubled in the second phase.

Mint quoted the state government's statement saying that the usage of EVs will increase the dependence on lithium-ion batteries, and with the establishment of Tata's plant, Gujarat will become a leading state in lithium-ion cell manufacturing and develop an ecosystem.

Data from Insta Financials show that Agrastas Energy Storage Solutions was incorporated on March 10, 2023, and registered in RoC-Mumbai, with an authorized share capital of INR2 million.

Tata Motors has been the leading electric four-wheeler (E4W) brand in India, grabbing more than 80% of the market share in the country. Despite accounting for just 1% of India's total car sales, India's E4W sales have been growing at a CAGR of 281% since 2019.

To meet the rising demand for EV and energy storage, India launched the Production Linked Incentive (PLI) scheme for advanced chemistry cells in late 2021, with a budget of INR181 billion and targeting a cumulative 50GWh in domestic manufacturing capacity.

India's official think tank NITI Aayog said in a report in late 2022 that India's annual demand for advanced chemistry cells may reach between 104GWh and 260GWh by 2030 across multiple sectors, including EVs, up from the 2.7GWh in 2022. Still, more than 90% of India's lithium-ion cells were imported from China and South Korea.

India's lithium-ion imports (US$m)

Fiscal year

Imports

FY16

274

FY17

329

FY18

548

FY19

1,226

FY20

1,246

FY21

1,193

FY22

1,832

Source: Ministry of Commerce and Industry of India, June 2023