When it comes to electric vehicles, certain things click in our minds. Such as combating climate change, less dependency on petroleum, and affordability. With the rising concerns about pollution levels, there has been increased demand for electric vehicles. While many European countries like Germany and Norway have the highest number of EV users. Hardly a few countries make Electric Vehicle batteries. And those are China, South Korea, Japan, and the USA. Out of these China holds the largest market share of EV batteries i.e. 56%. Really? Yes! Being a neighbor, we naturally wonder about “India vs China in EV”.
The EV batteries and EV charging ports are crucial components of the EV industry. So, the one who manufactures it dominates the market share. Does India also rank in the list? Well, not as of now, but it will surely rank in the future! Our government is immensely supporting the EV industry. What is the current status of the Electric Vehicles industry in India? You may wonder. To answer your query, we are presenting this write-up where we will compare our EV status quo with that of China.
India vs China: A Comparative Analysis of the EV Industry
Before diving deep further, let’s briefly catch up with the current scenario of the EV industry in India and China.
|Size of EV Market||Growing rapidly with the government’s support||The largest EV market in the world|
|EV Sales||Increasing steadily but comparatively lower||Highest EV sales in the world|
|Policy Support||Recently Indian govt. launched supportive schemes like FAME, GST benefits, etc.||Extensive subsidiaries for policy adoption|
|EV Charging Infrastructure||Limited||Well-developed|
|EV Battery Production||Limited domestic production and high dependency on imports||A dominant player in lithium-ion battery production|
|Supply Chain||Developing a domestic supply chain for EV components||Already has a well-established and extensive domestic supply chain|
|Research & Development||Growing focus on EV-related R&D and innovation||Significant investments in EV R&D and technology development|
|Export Potential||Comparatively Low||Major exporter of EVs and components globally|
Now, we will look at the perspective of India and China. To understand their position in the EV battery manufacturing market.
Current Scenario of EVs in India
In our country, the EV industry plummeted back in 2017. At that time, our then-transport minister, “Nitin Gadkari” presented India’s target. “Every third vehicle sold in India by 2030 would be an EV.” Can we reach this target in the upcoming seven years? Probably we will, if we boost the indigenous manufacturing of EVs. Because if we continue to depend on the imports of EV and EV batteries, then the cost of the vehicles would be sky-high. Eventually, it will be out of reach for the majority of Indians. In such a scenario, we won’t be able to achieve the target.
1. Indian Government’s Initiatives to Promote EV
Therefore, we need to take some solid steps to reach that goal! How will we do it? By buying an EV? Yes, you can purchase EVs instead of vehicles that run on petroleum products. However, it would be your personal choice. But millions of personal choices like this can bring EV revolution! And who can influence the common citizens the most? Government! The Indian government holds the highest degree of influencing capacity to encourage citizens to shift to EVs. Therefore, GOI launched FAME India under NEMM in 2015. These policies were designed to bring a sustainable future for India.
- FAME: Faster Adoption and Manufacturing of Electric Vehicles in India (including Hybrid Vehicles)
- NEMM: National Electric Mobility Mission
2. The power struggle among Indian Companies for EV Batteries
There are several battery players in the Indian EV ecosystem who are in tough competition with each other. Some of them are-
- Cell Propulsion
- Race Energy
- Log 9 Materials
- Ion Energy
As we mentioned above, we need to manufacture EV batteries indigenously to reduce the overall cost of the vehicle. This will make EVs affordable for Indians. Unfortunately, unlike China, we are unable to manufacture EV batteries on a large scale. Why? You will get to know it in the next section.
3. Why is India falling short and China is leading the EV battery manufacturing segment?
Reports say that EVs will increase our dependence on China for raw materials and battery production. Earlier we used to depend on Gulf countries for Petroleum. Are we landing into dependency again? Continue reading, and you will know the reason for this outcome.
Do you know what the core of an automobile is? Its engine and source of power! For EVs, we have exclusive engine manufacturers. Unfortunately, we are lacking in the manufacturing segment of EV batteries. Why? Well, the reason is obvious. To make a battery, you need raw materials, such as-
- Lithium (major component)
From where will you get these? By importing them from ore-rich countries. Although we can manage other elements, not Lithium. We import lithium from China! Here is the plot twist. Lithium is a weakness for India but a strength for China in terms of EVs. What? Yes, you heard it right. We fall short in manufacturing EV batteries because we have to import lithium from China. But China is free from this challenge. It has a vast lithium reserve due to which it is capable of manufacturing the EV batteries itself. And that too at a large scale and exports it. That’s the reason for holding a dominant market share (56%) in the manufacturing segment of EV batteries.
China’s dominance in EV battery production
Look at the following data (represented through an image)-
It clearly depicts the dominance of China in the EV battery manufacturing segment. Over the years, China has emerged as a global leader in electric vehicle production, solidifying its dominance in the industry. Chinese automakers have made significant strides in the EV market, with companies gaining international recognition. Some of the famous companies are-
- CATL (Contemporary Amperex Technology Co. Limited)
- BYD (Build Your Dreams)
- Nio Inc.
- Geely (Zhejiang Geely Holding Group Co. Ltd)
- Gotion High Tech Co Ltd
- EVE Energy Co. Ltd.
- Tianjin Lishen Battery Co. Ltd.
Some of the key factors behind China’s success are-
- Vast Lithium Reserves
- Massive scale and production capacity of its battery manufacturers
- Supportive nature of the Chinese Government.
1. Vast Lithium Reserves
Do you know China is one of the top countries in terms of lithium resources? It holds 2 million metric tons (MT) of lithium reserves. Last year, it increased its lithium production to 19,000 metric tons. Where does China use those masses of lithium? Mainly in the EV battery manufacturing industry. This led to the dominance of China in the lithium industry.
2. Massive scale and production capacity of Chinese battery manufacturers
Chinese battery manufacturers, such as CATL and BYD, have established themselves as major players in the global battery industry. These companies have invested heavily in research and development, leading to advancements in battery technology and innovation. They have been able to produce high-quality and cost-effective batteries, giving Chinese EV manufacturers a competitive edge.
3. Supportive Nature of the Chinese Government
Furthermore, the Chinese government has played a crucial role in supporting the development of a robust supply chain for EVs. It has implemented policies and incentives to promote the adoption of EVs. The Government of China has encouraged collaboration between automakers and battery manufacturers. This support has helped in the rapid expansion of the EV industry in China.
Thus, Chinese battery manufacturers like CATL, BYD, and EVE Energy have become key suppliers not only to domestic EV manufacturers but also to international automakers. These companies have achieved significant production capacity, allowing them to meet the growing demand for EV batteries worldwide.
Final words: Will India surpass China in the EV battery production segment in the Future?
Let’s come to the conclusion of India vs China in EV segment. China has been a dominant player in the electric vehicle (EV) battery production segment, with several major companies operating in the country. India, on the other hand, has been making efforts to boost its EV industry and attract investments. While it is difficult to predict the future accurately, India has shown potential with initiatives such as FAME and NEMM. Thus, with the right investments, policies, and technological advancements, India could potentially narrow the gap, but surpassing China shortly remains uncertain due to the absence of lithium reserves in India.
Wait! That’s not the end.
Recently, we discovered lithium ore deposits in J&K. So, is there any ray of hope? Yes! However, we aren’t sure whether we will surpass China or not. But we can surely reduce the EV battery manufacturing gap in the future and reduce our dependence on China.
Although our lithium deposits are in the preliminary stage, with the proper technology, we can also become a leading producer of EV batteries. Let’s hope for the best!