Get Ready For More Affordable India-made Electric Two-wheelers; Here’s How

The recent Lithium reserves discovery in the country will reduce the manufacturing costs of EVs

In February 2023, India made a huge discovery of 5.9 million tonnes of lithium reserves in Jammu and Kashmir. Why is this important? Well, chemicals manufacturer Neogen believes that with this discovery, India will be able to develop the entire battery cell architecture and ecosystem here itself.

What does this mean for EV manufacturers? Currently, EV makers are heavily dependent on other countries for their lithium requirements, especially battery cells. The reserves found in India will make us independent and cut down on our costly imports which will consequently result in a heavy reduction in manufacturing costs. Subsequently, India can also become an exporter of lithium reserves in the long run.

So why should the end consumer care? With the heavy reduction in manufacturing costs, the selling prices of the electric two-wheelers will also go down, and that will make everyone, including the end consumers happy. It would also allow the manufacturers to develop the battery cells according to Indian weather conditions, which could make it (and EVs) safer than the ones that are imported.

With affordable manufacturing costs, more companies are likely to enter the EV market and popularise the same. Moreover, with the Fame 2 subsidy likely to be phased out by April 2024, manufacturers will have to rely on building a strong supply chain, especially at the cell manufacturing level, and this development will help achieve exactly that. 

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What is the struggle then? At present, India is quite underdeveloped to process the lithium reserves and chemicals into the final product used by the EV manufacturers.

This is where companies like Neogen come in. Neogen is working on making the electrolytes in India itself and to achieve that, it has signed a deal with MU Iconic Solutions Corporation (MUIS) which is a part of Japan's Mitsubishi Chemical Corporation.

With the deal, Neogen will be able to produce 30,000 metric tons of electrolytes per year in India in a phased manner, and will not have to pay any royalty for the manufacturing and making use of its proprietary technology.

This development comes in just under a year after Ola Electric signed a pact with the government to make indigenous EV battery cell manufacturing in India, on a large scale.

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