India’s Tata Group is to spend 130 billion rupees ($1.58 billion) building a lithium-ion cell factory as it bids create a domestic electric vehicle supply chain.
A joint statement on the memorandum of understanding, between Tata’s unit Agratas Energy Storage Solutions and the government of the western state of Gujarat, said work on the plant, to be based in Sanand, northern Gujarat, was expected to start in less than three years.
It would have initial manufacturing capacity of 20 Gigawatt hours (GWh), which could be doubled in a second phase of expansion, the statement said.
“The plant will go a long way in contributing to the development of the EV ecosystem in Gujarat and India,” Vijay Nehra, an official in the Gujarat state government said.
Compared to the size of its population, India’s car market is tiny. Tata Motors dominates its electric vehicle (EV) sales, which made up just 1% of India’s total car sales of about 3.8 million last year.
- Reuters with additional editing by Sean O’Meara