from scale to IP — India must focus on innovation
The Indian battery market is experiencing significant growth, driven by increasing demand for electric vehicles (EVs) and renewable energy storage solutions. The same is also driven by a need for larger decarbonisation across industries, such as Defence, and new innovative solutions involving highcapacity drones. With the demand for batteries now increasing, the need for Indian Battery Suppliers to enter the fray is also growing. The market across the different kinds of applications offers an unmissable business and innovation opportunities fto Indian Battery Manufacturers
The Indian market is expected to reach USD 20.04 billion by 2030, according to NextMSC, with a compound annual growth rate (CAGR) of 15.5% from 2023 to 2030. Lithium-ion batteries, in particular, are experiencing strong demand, driven by the growth of consumer electronics and electric vehicles (EVs).
Indigenous Lithium-Ion Battery Development
Indian companies are working on homegrown lithium-ion battery technologies to reduce dependency on imports. For a long time, Indian companies were essentially importing the various components and then assembling them. Government-backed institutions are developing advanced battery chemistries tailored to Indian conditions (high temperatures, humidity, etc.); however, the bulk of the requirements in India have been met by imports and assembly. Over the last few years, considerable effort has been invested in scaling production capacity. Still, only small steps have been taken to reduce the import dependency of core components, including cells, electrolytes, and battery management systems. India has now begun investing in the capacity for manufacturing battery cells. The government PLI schemes have already been initiated, and the first three winners have been announced. Similar initiatives by the government have been announced across the value chain through the FAME and PM E-Sewa schemes to promote market growth.
The Market for Batteries and Storage is not just in India, but global. In any product or service, unless we aim to build capacity, solution, and scale for the global market, we will not be able to make a truly significant mark. In the few industries where India dominates globally, such as IT services, textiles, and gems / Jewellery, the focus has been on innovation across the entire value chain. Future:
So, how do Indian companies innovate, and why is it imperative to do the same. The market for low-cost, affordable Storage solutions will always exist in India and will only grow in leaps and bounds. While driving scale will help in reducing the cost and drive penetration and market share, we should remember one of the most critical strengths of the Market, “the diversity of the market”.
Innovation across Battery Design
The Indian market offers huge volumes for a wide range of products, Including Low-Speed Scooters, high-speed bikes, Passenger Vehicles, Electric Buses, and now new storage use cases across various sectors, such as stationary storage. Possibly, no market is as large as India’s, except for China; hence, this presents battery manufacturers with an opportunity to innovate. This enables Indian Battery Manufacturers to dominate certain segments with affordable, innovative solutions. The passenger e-rickshaw segment is growing leaps and bounds. The need for a rugged, affordable battery has led to small innovations in cell packing and the launch of Smart BMS. A significant amount of innovation is being developed in the BMS segment, focusing on redundant protections across voltage, current, and thermal management. These small innovations could be used to build successful moats around low-cost solutions and subsequently sell them to the export market as well. Smart BMS enables multiple levels of control over the battery, helping battery manufacturers achieve better control of quality assurance and customer service, which can be exported globally.
Innovations around Chemistry
Alternate Battery chemistry is being developed globally, and Indian manufacturers could build in India and sell globally. These chemistries enable innovations in energy density. India could take the lead in certain battery storage solutions, particularly in chemistries such as sodium-ion and vanadium flow batteries. Startups and existing Battery manufacturers should come together to pioneer and build these technologies as the battery market explodes, with the global market being the core focus.
Solid-State Batteries:
Innovations in solid-state batteries have already begun to take place in India. Companies are developing solutions that promise improved energy density, enhanced safety and reliability, and address concerns related to range and Reliability. Indian companies could quickly capture innovative niches around this in India and then move into the global market.
Innovation in Battery Performance:
One of the key areas of innovation will be around how batteries utilise the Battery Management system to create the operational envelope, which drives Safety, Reliability, and Affordability. Self-healing algorithms and smart firmware that use the foundations of Machine learning will be the new frontiers of innovation.
How will India achieve this transition to IP-based Innovation from Low-Cost Scaling
Startups and Innovators
India has seen a surge of battery tech startups, especially across the following domains
Lithium-ion batteries
- Alternative chemistries like sodium-ion, solid-state, and zincbased batteries
- Battery Management Systems (BMS) and smart charging solutions
These startups have benefited from various Government Initiatives, including government-backed AICs (Atal Innovation Centres) and Grants through ministries’ programs. India needs to attract more innovation and patient capital to fund and finance Battery and Ecosystem innovation across Material, Process, and Design Innovation in Batteries.
Large Corporates
Major players are investing in research and development (R&D) as well as manufacturing.
- Chemical Companies
- Companies in the Auto Segment
- Diversified Conglomerates
Large corporates need to handhold startups and innovate with them.Large corporates, apart from investing in Technology in-house, could partner with startups to become first adopters and enablers of technology. The current model of Pilots and POCs creates the proverbial valley of death scenario, where many great ideas end up not scaling commercially due to a lack of early adoption and available customers.
Research Institutions
Pioneering research in energy storage materials and tech:
- Government-run Laboratories
- Private and Government-run Educational Institutes
India could focus on driving Material innovations through government and educational research facilities. Chemistry innovation and Material innovation could do well if Corporates join hands and commercialise the IP being built around Cells, Chemistry and innovation in Battery Management System.
The IP innovation could be made available to the Indian Battery Ecosystem through a mix of Licensing and Joint ventures.
Government & Policy Support
Government plays a major enabling role:
- PLI Scheme (Production Linked Incentive) for Advanced Chemistry Cell (ACC) batteries to boost local manufacturing
- FAME-II Scheme to promote EV adoption, indirectly spurring battery innovation
- Battery Swapping Policy (2022 draft) to support modular, interoperable battery tech
Each government policy has contributed to advancing Indigenous development and expanding the market. Indian Entrepreneurs must now rise to the challenge of investing heavily in building on this by investing in R&D. India offers a large captive market for innovation to thrive.
When driven through the lens of global competitiveness, it will help Indian Entrepreneurs thrive. The Global Auto Industry is already sourcing a lot of components from India.
Suppose a significant portion of global innovation in the EV domain is conducted in India. In that case, it will provide a substantial foundation for the Indian Battery and EV ecosystem to innovate and build intellectual property in India. India’s strengths lie in a World-class talent base – This is well-established in the STEM domain and does not require further establishment.
- A thriving Indian ecosystem in the EV space aptly enabled through a series of well-thought-out policies
- A global Sourcing Base for the Auto Industry, which could be replicated for the EV industry.
- A growing innovation pool around Cells and Battery Management System.
- An established base in Software and AI innovation.
Battery Companies must lead the way in Building in India for India and then expand globally. If this simple thought process could be taken forward, Indian companies in the Battery space could become drivers of innovation and IP and not thrive solely through scale and cost. ■
Disclaimer: The views expressed by the author are his own and do not necessarily reflect the views of FMM magazine.
Arjun Sinha Roy
Co-founder
iRasus Technologies