India’s ₹12,000 Cr Battery Push in Works; ICICI Direct Spots Likely Winners

India is preparing a new incentive scheme worth around ₹12,000 crore to support domestic manufacturing of key battery components, according to a report by The Economic Times. The proposal is aimed at reducing India’s dependence on imports for materials used in advanced chemistry cell battery production.

The proposed scheme is expected to support manufacturing of cathode active materials (CAM), anode active materials (AAM), electrolysers, copper foil and separators. The proposal is currently in the final stages of approval.

Financial incentives under the scheme will come with conditions to ensure companies build manufacturing capacity within India instead of importing finished products and carrying out limited processing to claim benefits.

Expanding Domestic Battery Manufacturing

The proposed scheme is expected to complement the government’s existing ₹18,100 crore production-linked incentive scheme for Advanced Chemistry Cell (ACC) battery manufacturing, which aims to create 50 gigawatt hour production capacity in the country.

India has been focusing on import substitution as it pushes manufacturing growth in sectors such as emission-free vehicles, defence and space applications.

Industry estimates suggest the country could require more than 200,000 tonnes of AAM and over 400,000 tonnes of CAM by 2030 to support an estimated 223 GWh domestic battery manufacturing capacity.

Industry players have also sought import tax relief to support local manufacturing, though officials said a final decision on duty waivers has not been taken yet. In Budget 2026-27, the government extended customs duty exemption on capital goods used in lithium-ion cell manufacturing for battery storage systems.

Companies Seen Benefiting

In a blog on the development, ICICI Direct Research said the proposed scheme could benefit companies expanding into battery materials manufacturing.

The brokerage said HEG, which is setting up a graphite anode facility, and Graphite India, which has signed an MoU with the Maharashtra government for a synthetic graphite anode project, could emerge as key beneficiaries under incentives linked to anode active materials.

Demand for copper foil is also rising globally as battery manufacturing expands. A report by the International Copper Association of India shows Chinese companies control nearly 80% of global copper foil manufacturing capacity, while South Korean manufacturers account for the rest.

ICICI Direct added that Hindalco may also benefit as the company is setting up a battery-grade copper foil manufacturing facility, adding that the scheme could help accelerate localisation of India’s battery supply chain and create long-term opportunities for domestic manufacturers.