India’s Battery PLI Falls Far Short: Just 1.4 GWh Built Against 50 GWh Target

India’s flagship subsidy program to build a domestic battery industry has so far delivered only a sliver of what was promised, leaving the country still almost entirely dependent on imported cells even as it pushes for mass adoption of electric vehicles.

1.4 GWh commissioned, no incentives paid

By October 2025, just 1.4 gigawatt-hours (GWh) of advanced chemistry cell (ACC) battery capacity had been commissioned under the government’s Production-Linked Incentive (PLI) scheme for battery storage, according to a January 2026 assessment by JMK Research and Analytics and the Institute for Energy Economics and Financial Analysis (IEEFA). That is 2.8% of the 50 GWh goal the program was meant to unlock by the end of 2024.

All of that capacity has been set up by Ola Electric Mobility. The other approved beneficiaries — Reliance Industries units and ACC Energy Storage, a subsidiary of gold retailer Rajesh Exports — have yet to commission cell manufacturing lines that meet the program’s conditions. No PLI incentive payments have been made so far.

A wide gap between targets and outcomes

The Ministry of Heavy Industries projected the ACC PLI scheme, approved by the Union Cabinet on May 12, 2021, would catalyze around 50 GWh of battery manufacturing, draw in more than ₹11,000 crore in investment and create about 1.03 million direct and indirect jobs.

As of October 2025, the JMK–IEEFA assessment found that about ₹2,870 crore had been invested and 1,118 jobs created — roughly a quarter of the investment estimate and 0.12% of the expected employment.

“There is a substantial gap between the intended and actual outcomes of the ACC PLI scheme,” the analysis said, adding that India’s dependence on imported battery cells remained “close to 100%.”

A demanding design: localisation and timelines

Launched as the National Programme on Advanced Chemistry Cell (ACC) Battery Storage, the PLI scheme is designed to support any qualifying cell technology — including lithium iron phosphate (LFP), nickel manganese cobalt chemistries and newer variants — as long as performance and safety standards are met. The government set aside ₹18,100 crore in incentives, to be paid out over five years against actual sales.

The structure is unusually demanding. Beneficiary companies must invest at least ₹225 crore per GWh of capacity within two years and achieve 25% domestic value addition (DVA) over the same period. Over five years of commercial operation, DVA must rise to 60%.

“The beneficiary firm has to ensure achieving a domestic value addition of at-least 25% and raise it to 60% within 5 Years,” the Ministry of Heavy Industries said in its scheme guidelines.

The performance period, which runs from January 1, 2025, to December 31, 2029, is when subsidies are to be paid, provided companies have commissioned plants and met localisation thresholds. Delays attract penalties of 0.1% per day on performance security.

Missed milestones and penalty notices

In practice, the timelines and localisation requirements have proved hard to meet for firms building gigafactories in India for the first time.

All three initial beneficiaries — Ola Electric, Reliance New Energy (a Reliance Industries arm) and ACC Energy Storage — missed a key December 31, 2024 milestone for plant commissioning and DVA, according to people familiar with the matter. A senior official told The Economic Times in early 2025, “All beneficiaries did not meet the December 2024 milestone… Without production, there is no incentive to be disbursed.”

The ministry issued notices over the delays in March and May 2025. If enforced strictly, the daily penalties would amount to about ₹12.5 lakh for Ola Electric and ₹5 lakh each for Reliance and Rajesh Exports, the Economic Times reported, citing official calculations. All three companies have asked the government to waive penalties and extend deadlines, in some cases citing force majeure.

Company-by-company progress

Ola Electric: 1.4 GWh commissioned, localisation hurdle remains

Ola Electric, which has the largest allocation at 20 GWh, has so far commissioned 1.4 GWh of cell capacity at its Tamil Nadu facility. Analysts say this line remains short of the 25% domestic value addition threshold, meaning the company is not yet eligible for PLI payouts.

The company has revised its rollout plans. Public statements and industry reports indicate Ola now aims to reach 5 GWh of capacity by March 2026 and does not plan to fully ramp up to the 20 GWh allocated under the scheme until around fiscal year 2029.

Reliance: Jamnagar ecosystem plans, production yet to qualify

Reliance, which secured 5 GWh in the first auction round and another 10 GWh in a second tender in 2024, has announced plans for a battery manufacturing ecosystem at its Jamnagar complex in Gujarat. Government statements say Reliance has set up plant infrastructure, but large-scale commercial cell production under PLI norms has yet to begin.

The JMK–IEEFA assessment noted Reliance’s second-round 10 GWh allocation was the only tranche that might still be commissioned on time if deadlines are extended, while the initial 5 GWh is already behind schedule.

Rajesh Exports: land protests and execution questions

Rajesh Exports’ ACC Energy Storage unit, awarded 5 GWh, has made the least progress. The company has reported land acquisition at a site in Karnataka, but work was held up by prolonged protests from local farmers. Reporting in late 2025 said the project faced about 19 months of delay in securing peaceful possession, with the company seeking deadline extensions on force majeure grounds.

Analysts have also flagged questions around Rajesh Exports’ financial capacity to execute a capital-intensive, technology-heavy project far from its core jewelry and bullion businesses.

A due diligence controversy: the “Hyundai Global Motors” episode

The scheme’s early implementation was marred by a separate controversy: an initial allocation of 20 GWh to a little-known entity calling itself Hyundai Global Motors. The company implied links to South Korea’s Hyundai Motor Co., which Hyundai denied. The allocation was eventually canceled after officials concluded the firm had misrepresented itself.

Half of that capacity, 10 GWh, was re-tendered in 2024 and awarded to a Reliance unit. The remaining 10 GWh is yet to be allocated; the government began steps in early 2026 to auction it again.

Structural obstacles beyond individual firms

Beyond company execution, industry analysts and think tanks point to several structural reasons for the slow rollout.

Building a gigafactory from scratch in a country with almost no existing cell manufacturing base typically takes several years, involving complex supply chains, imported machinery, and long qualification cycles with customers. India entered the program with no commercial-scale cathode, anode, electrolyte or separator industries, and with nearly all vehicle and storage systems powered by imported cells, mostly from China.

Technology providers and equipment suppliers for cell plants are heavily concentrated in China, South Korea and Japan. Companies and analysts say installation and commissioning work in India has been hampered by delays in securing visas for Chinese engineers and technicians amid heightened scrutiny of Chinese investment and personnel.

Meanwhile, the global battery market has changed since 2021. Worldwide cell manufacturing capacity has surged, dominated by Chinese firms, pushing down prices and leaving a glut in some segments. For Indian manufacturers, importing cells can be cheaper than accelerating risky greenfield investments while chemistries and EV demand patterns are still shifting.

Questions about tender design

Critics of the tender design say the evaluation process also contributed. Among all bidders in the first and second rounds, only Exide Industries and Amara Raja Batteries had extensive experience manufacturing batteries at scale, yet neither secured allocations.

The winning bids came from newer or less experienced cell makers, including Ola Electric — an EV startup — and Rajesh Exports, which has no prior track record in lithium-ion technology.

Analysts say bid scoring gave heavy weight to the amount of capacity proposed, localisation promises and subsidy discounts, while placing less emphasis on technical and operating experience. The Hyundai Global Motors episode raised further questions about due diligence.

Policy flexibility under discussion

The Ministry of Heavy Industries has begun signaling flexibility. In public comments in late 2025, Heavy Industries Minister H. D. Kumaraswamy acknowledged that against a 50 GWh target, “by June 2025 only 1.4 GWh was ready.” People familiar with internal discussions say the ministry is considering extending deadlines by up to 18 months, easing localisation requirements, and temporarily allowing low-duty imports of cells to keep the EV market supplied while domestic plants come up.

Why it matters for EV targets—and industrial strategy

India has set a goal of having 30% of new vehicle sales be electric by 2030. Electric vehicles accounted for 7.6% of sales in 2024, driven mostly by two- and three-wheelers. In an August 2025 report, government think tank NITI Aayog said India “will need to lift electric vehicle (EV) adoption by more than 22 percentage points in the next five years” to stay on track.

Without large domestic cell plants, analysts say, EV makers will remain exposed to import costs and supply risks, especially from China, complicating efforts to lower prices and expand exports.

The PLI scheme’s performance is also being closely watched as a bellwether for India’s broader use of subsidies and local content rules to attract manufacturing in semiconductors, solar modules, electronics and autos. The ACC program’s combination of aggressive targets, strict localisation rules and limited on-the-ground progress illustrates the challenge of building complex new industries through policy design alone.

For now, the physical reality of India’s battery push can be counted on one hand. Against 50 GWh of capacity envisioned on paper, there is 1.4 GWh of commissioned production, running at a single company’s plant, and a growing list of extensions, waivers and redesigns under discussion in New Delhi. Whether those adjustments will be enough to turn plans into gigafactories — and in time to support India’s EV ambitions — remains an open question.