Niti Aayog’s plan to subsidise manufacturing of batteries for electric vehicles (EVs) and mobile phones has been approved by the finance ministry. ET citing a senior government official reports that the proposal entailing annual subsidy of Rs 700 crore will now go to the cabinet for its nod.
The expenditure finance committee (EFC) nodded to the Niti Aayog’s proposal for creating 50 GWh battery capacity in the country.
The official speaking to the publication said “The proposal will now be sent to the cabinet for approval, following which the Aayog will invite bids in December”.
According the report, soon after the cabinet’s approval the contracts will be awarded so that battery manufacturing plants are up and running by 2022. I
The government expects to bring down the cost of these batteries to $76, or about Rs 5,450, per kilowatt hour (kWh) from $276, or about Rs 19,800, per kWh once the battery manufacturing picks up pace in the country. This in turn is expected to bring down the cost of electric vehicles.
At present batteries account for an average of 50% of the cost of electric vehicles in the country.
The official said further added that the government planning to link subsidy to the capacity creation committed and the level of indigenization.