India's Energy Transition Enters Critical Execution Phase
India's ambitious journey toward clean energy has moved decisively from planning to implementation. With electric vehicles gaining market traction and renewable energy capacity expanding rapidly, the nation now faces the substantial challenge of building sustainable industrial capabilities to support this transformation over the coming decades.
The Central Role of Battery Ecosystems
As the Union Budget 2026 approaches, batteries for electric vehicles and Battery Energy Storage Systems (BESS) have emerged as focal points of discussion. These components are fundamental not only for clean mobility but also for ensuring grid stability and national energy security. However, current policy emphasis has predominantly centered on cell manufacturing alone, overlooking the broader value chain where true long-term competitiveness is determined.
Scale of the Challenge: Massive Demand Ahead
The magnitude of India's battery requirements is staggering. Industry projections indicate that BESS deployments alone could reach approximately 208 GWh by 2030, equivalent to the battery capacity needed for nearly 3 million electric vehicles. Meeting this enormous demand will necessitate vast quantities of critical materials, including:
- 200 kilotons of graphite anodes
- 400 kilotons of LFP cathodes
- Substantial volumes of electrolyte, copper foil, and aluminium foil
Currently, India imports nearly 100% of these essential materials from China, which dominates global supply chains. This creates significant strategic vulnerability as the nation reduces fossil fuel dependence, potentially replacing one form of energy reliance with another—this time on imported battery components.
Strategic Autonomy at Stake
In today's volatile global environment, concentrated supply chains represent more than just a cost concern—they directly impact India's strategic autonomy. This dependence will intensify as electric mobility scales across the country, with several states targeting 15 to 25 percent EV penetration by 2030 across two-wheelers, three-wheelers, public transport, and commercial fleets.
Battery demand from both mobility and grid-scale storage will grow simultaneously, placing unprecedented pressure on supply chains and highlighting the urgent need for domestic manufacturing capabilities.
Building from the Ground Up: The Atmanirbhar Imperative
For the vision of Atmanirbhar Bharat and Make in India to achieve meaningful realization, India must develop its battery ecosystem comprehensively. This requires moving upstream into mining and manufacturing advanced battery materials like anodes and cathodes, which significantly influence battery cost, performance, reliability, and supply-chain risk.
Without domestic capabilities in these critical areas, cell manufacturing risks remaining assembly-driven rather than innovation-led. Globally competitive battery ecosystems have emerged through tight integration of material science with cell engineering, enabling faster innovation, superior performance optimization, and resilient scaling.
The Qualification Challenge and Policy Imperatives
Developing new battery materials presents substantial challenges, as qualification processes typically require three to five years for cell manufacturers. Once supply relationships are established, switching becomes complex and costly, emphasizing why ecosystems must evolve collaboratively rather than in isolation.
Policy intervention plays a crucial role in enabling this transition. Manufacturing advanced battery materials demands significant capital investment, technological expertise, and involves high upfront costs with long gestation periods before achieving commercial scale. These realities must be clearly reflected in industrial policy frameworks.
Union Budget 2026: A Transformative Opportunity
As expectations for the Union Budget 2026 take shape, targeted support for upstream battery materials could prove transformative. Potential measures include:
- CAPEX subsidies for anode and cathode manufacturing
- Risk-sharing mechanisms to encourage domestic production
- Policy alignment between EV adoption incentives, ACC manufacturing schemes, and broader industrial strategy
When these elements operate in synchronization, cohesive ecosystems form. When they function in isolation, progress remains fragmented and inefficient.
Global Leadership Potential
India possesses a genuine opportunity to emerge as a credible alternative in global battery supply chains, offering scale, quality, and reliability while meeting international standards for sustainability and transparency. This aligns perfectly with the Make in India spirit, serving both domestic requirements and global market demands.
The Union Budget 2026 can send a decisive signal by strengthening upstream capabilities, encouraging value-chain integration, and reinforcing strategic self-reliance. Through these measures, India can build a resilient, globally competitive battery ecosystem that shapes the nation's position in the global energy transition for decades to come.
The choices made today will determine whether India merely participates in the energy transition or leads it through innovation and industrial strength.
