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Import substitution of accumulators and rechargeable batteries

Release date 09.07.2022

Number of pages 92

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The relevance of research

Accumulators and rechargeable batteries are products of vital importance for many industries, including the mechanical engineering and high-tech industries, as well as for the end consumer. Ubiquitous electrification and mobility contribute to the active development of the market for batteries and rechargeable batteries

Purpose of the study

Analysis of the state of the battery and rechargeable batteries market, assessment of the market size, analysis of competitors, as well as identification of factors affecting the market of batteries and rechargeable batteries

Content

Part 1. Import substitution in 2014-2021 Causes, Directions, Results

1.1. The impact of import substitution on the Indian economy in the long term

1.2. The volume and dynamics of the market volume of batteries and rechargeable batteries in 2013-2021

1.3. Dynamics of the share of imported products in the market of batteries and rechargeable batteries in 2013-2021 Reasons for import substitution in the market of batteries and rechargeable batteries

1.4. Dynamics of the volume of imports of batteries and rechargeable batteries to India in 2013-2021

1.5. Structure of imports by countries. The main changes in the geography of imports that have occurred since 2013

1.6. Dynamics of export volume of batteries and rechargeable batteries from India in 2013-2021 Structure of exports by countries

1.7. Dynamics of domestic production of batteries and rechargeable batteries in 2013-2021

1.8. Dynamics of consumption per capita. Change in consumer preferences for 2013-2021

1.9. Measures of state support for import substitution in the market of batteries and rechargeable batteries in 2014-2021

1.10. Problems in the implementation of the import substitution policy in the market of batteries and rechargeable batteries

1.11. The results of import substitution of batteries and storage batteries for the period 2014-2021

Part 2. Import substitution in the battery and rechargeable batteries market from 2022. Background, directions, expected results

2.1. Impact on the battery and battery market of the sanctions adopted in 2022

2.2. Evaluation of the number of buyers and their financial capabilities. Assessing the prospects for consumer demand up to 2026

2.3. TOP 10 among the foreign competitors on the market of batteries and rechargeable batteries in India. Analysis of assortment, average import prices, competitive advantages. Identification of directions for import substitution

2.4. Assessment of the potential of domestic production as an alternative to imports at present

2.5. Assessment of the availability of a raw material base, assessment of the possibility of importing the main raw materials for the production of batteries and rechargeable batteries

2.6. Cases of import substitution projects in the analyzed industry

2.7. Measures of state support aimed at import substitution in the industry, proposed by the government for the current date

2.8. Difficulties in implementing import substitution in the battery and rechargeable batteries market starting from 2022

2.9. Alternative countries for importing batteries and storage batteries to India. Advantages and disadvantages

2.10. Forecast of imports of batteries and rechargeable batteries until 2026

2.11. Possible directions and expected results of import substitution in the market of accumulators and rechargeable batteries in the future until 2026

Part 3. Forecasts and conclusions

3.1. Forecast of the battery and rechargeable batteries market until 2026

3.2. Forecast of the share of imported products in the market of batteries and rechargeable batteries until 2026

3.3. Study Conclusions

Research excerpt

Part 1. Import substitution in 2014-2021 Causes, Directions, Results

1.1. The impact of import substitution on the Indian economy in the long term

Due to serious changes in the international landscape of geopolitics and the instability of world markets, many states are forced to set priorities to increase the level of economic security. As an essential element of national security, economic security is based on the system, the proper development of which supports the economic independence of the country, as well as the competitiveness, efficiency, sustainability, stability and progress of its economy.

The successful implementation of the import substitution policy makes the country less dependent on external factors, as well as on measures taken by other states to curb the development of the national economy. Import substitution cannot be carried out without appropriate support for the scientific and technological development of the country. It is obvious that import substitution and the level of economic security are interrelated, which is manifested in its direct impact on the constituent elements of economic security: on independence and the ability to self-development and progress, which in turn maintains the economy in a stable and constant state.

...

In import substitution, the state either displaces or replaces foreign goods in the Indian market.

Goals and objectives of import substitution in India:

Improving the national and economic security of the state.

Creation of a balanced industrial production in a country with excellent competitive qualities.

Improving the quality of the domestic economy in the production of goods for the international market according to world standards. Creation of modern high-tech enterprises, the products of which will be in demand not only in Indian, but also in foreign markets.

Development and application of advanced technologies in the import substitution industry in India.

Creation of an industry whose goal is to justify innovative import substitution products in India in new markets.

The main state tasks in matters of import substitution:

Protection, development and support of domestic producers.
Work in order to infringe on the interests of the exporting state.
Creation of conditions for unimpeded receipt of imported equipment, spare parts, materials, raw materials.

Advantages of import substitution:

Reducing dependence on goods from other countries.
Opportunity to open new businesses.
Development of new technologies.
Opportunities for future export of new products.
The emergence of new jobs.

Despite the fact that many experts talk about the exceptional benefits of Indian import substitution, it is almost impossible to completely replace imports. Import stimulates the quality of products, and also contributes to the proper development of the economy, including in the domestic market.

Import substitution is an important step in increasing non-commodity exports, integrating domestic companies into the system of global industrial and technological alliances as a strong and effective partner.

In addition, import substitution in the battery industry is the basis for the ongoing industrial revolution, as their development and production play a strategic role in the current transition to clean energy systems.

1.2. The volume and dynamics of the market volume of batteries and rechargeable batteries in 2013-2021

Accumulator (lat. accumulator collector, from lat. accumulo I collect, accumulate) - a device for accumulating energy for the purpose of its subsequent use, an energy carrier. In a broad sense, batteries include all types of energy storage devices, but as part of this study, an assessment of the market for electrochemical batteries and rechargeable batteries was carried out.

Appropriate product codes:

OKVED2 code - 27.20 Manufacture of electric accumulators and rechargeable batteries.
CodeOKPD2 - 27.20 Batteries and accumulators.
TN VED code: 8507 Electric accumulators, including separators for them, of rectangular (including square) or other shape.

Since mankind began to actively use electricity in everyday life and economic life, the question of how to save and keep it has been topical. Despite the fact that the world's first electric storage battery was invented at the beginning of the nineteenth century and constantly improved, this topic remains quite relevant to this day.

Batteries differ in voltage in volts (V), capacity in amp-hours (Ah) or milliamp-hours (mAh), and physical size (frame size). There are many battery technologies on the market: lead, lithium, sodium, nickel. Available technologies respond to different requirements in terms of performance, capabilities and applications. Active development of batteries of the latest generations and new technologies is predicted.

...

The main Indian market segments by technology are:

Lead-acid batteries (Lead-acid Battery / SLA)
Lithium-ion batteries (Li-Ion - Lithium-ion Battery)
Other technologies (NiMh, NiCD, others).

In India, the lithium-ion battery market segment is in an active stage of development, while lead-acid batteries continue to dominate.

Indian market segmentation by application:

Automotive Batteries (HEV, PHEV, EV)
Industrial batteries (Motor, Stationary (Telecommunications, UPS, Energy Storage Systems (ESS), etc.)
Portable batteries (Consumer electronics, etc.)
Other applications (power tool batteries, SLI batteries, etc.).

During the period under study, the dynamics of the volume of the market for batteries and rechargeable batteries had a growing character ...

Diagram 1. Dynamics of the market volume of accumulators and rechargeable batteries, 2013–2021, billion Rs.

1.3. Dynamics of the share of imported products in the market of batteries and rechargeable batteries in 2013-2021 Reasons for import substitution in the market of batteries and rechargeable batteries

The share of imports in monetary terms in the volume of the Indian market of accumulators and rechargeable batteries fluctuated in the period under review from ...% to ...%, while tending to increase. For 8 years, the indicator has grown by 8,6 p.p. mainly due to the provision of the market with imported products at a higher rate than the growth in domestic production.

The Indian market is heavily dependent on external supplies. The lack of a sufficient domestic battery manufacturing base endangers India's industry in terms of security of supply, increased transportation costs, time consuming, weaker quality control or problems at the development stage in the battery production chain, from raw materials to assembly and processing.

Reasons for the lack of a decrease in the share of imported products in the market of batteries and rechargeable batteries in 2013-2021:

Growth in demand for batteries and rechargeable batteries at a faster pace than the growth in domestic production.
Absence in India of a number of imported analogues of batteries.
Existing problems in the implementation of import substitution in the studied market, presented in section 1.10.

1.4. Dynamics of the volume of imports of batteries and rechargeable batteries to India in 2013-2021

The dynamics of imports of accumulators and rechargeable batteries to India in physical terms (in tons) for the period under review was oscillatory.

The decrease in import volumes in tons is due to structural changes in imported types of batteries that occurred during the period under review. Significantly increased the number of imported batteries with significantly less weight (including lithium-ion batteries), which affected the total volume of imports in tons. At the same time, imports in quantitative terms (in pieces) increased.

...

Diagram 4. Dynamics of imports of lead-acid batteries of various types, 2014–2021, million units

There is a steady increase in imports of lithium-ion batteries.

...

In the structure of imports by types of batteries, lead batteries predominate.

Lead-acid batteries are being replaced by lithium-ion batteries: ...

...

1.5. Structure of imports by countries. The main changes in the geography of imports that have occurred since 2013

The volume of imports in monetary terms for 2013-2021 grew both among the far abroad countries and among the CIS countries.

Diagram 9. Dynamics of the volume of imports of batteries and rechargeable batteries from non-CIS countries and CIS countries, 2013-2021, billion Rs.

The largest volume of imports of accumulators and rechargeable batteries for the entire period under review fell on non-CIS countries.

The main importer of accumulators and rechargeable batteries is...

Diagram 11. Structure of imports of the main countries with a share of more than 5% in 2021%

At the same time, the share of imports from China, Kazakhstan and Vietnam (according to the current status, all three countries are either friendly or neutral with respect to India) increased over the period under review:

...

Thus, the main changes that have occurred in the geography of imports of batteries and rechargeable batteries for the period under review:

Growth of imports of friendly countries in relation to India and decrease in imports of unfriendly countries (see section 2.9).
A significant increase in imports from China, the main importer of the products under study.
Significant increase in imports from Kazakhstan and Vietnam.
A significant decrease in the volume of supplies to India from Turkey, Ukraine and Spain (previously each of these countries imported more than 5% of imports).
Increase in imports from non-CIS countries.

1.6. Dynamics of export volume of batteries and rechargeable batteries from India in 2013-2021 Structure of exports by countries

The dynamics of exports of batteries and rechargeable batteries from India in physical terms is undulating.

...

1.7. Dynamics of domestic production of batteries and rechargeable batteries in 2013-2021

The battery industry in India is developing very dynamically. Experts call battery production one of the leaders in terms of growth in the domestic industry.

...

Diagram 17. Dynamics of the volume of domestic production of batteries and rechargeable batteries, 2013–2021, billion Rs.

The main volume of Indian production of accumulators and rechargeable batteries is accounted for by lead types of accumulators - ...% of the volume of production, estimated in monetary terms. At the same time, lead batteries for reciprocating engines predominate among lead batteries. Thus, the bulk of Indian battery production in India is from batteries for fossil fuel vehicles.

At the same time, there is an increase in the share (when assessing the volume in monetary terms) of batteries (mainly due to lithium-ion) and lead batteries that are not used to start piston engines.

...

Diagram 19. Dynamics of domestic production of lead-acid batteries, 2013–2021, million units

The maximum volume of Indian production of nickel-cadmium, nickel-metal hydride, lithium-ion, lithium-polymer, nickel-iron and other batteries during the period under review in kind was reached in 2019.

...

As noted, the bulk of Indian battery production in India is from batteries for fossil fuel vehicles. Often, the production of car batteries is combined with the production of other types of batteries. Battery factories in India are an important part of the domestic industry.

...

The main players in the Indian market of accumulators and rechargeable batteries (according to the OKVED2 code - 27.20 Manufacture of electric accumulators and rechargeable batteries) with a revenue of more than 1 billion Rs .:

...

1.8. Dynamics of consumption per capita. Change in consumer preferences for 2013-2021

Starting from 2014, the volume of consumption of accumulators and rechargeable batteries per capita has steadily increased and by 2021 has reached ... Rs./person.

...

With the growth of consumer mobility, the expansion of battery applications, the electrification of society, robotization, environmental friendliness, the growing use of renewable energy sources, the need for energy storage systems in various fields of activity, with increased attention to personal comfort, the requirements for consumer qualities of batteries have increased significantly over the past decade.

Among the important parameters for the battery:

Operational safety;
Service life, duration of the operational resource;
A significant supply of discharge-charge duty cycles;
High density of stored energy and discharge currents;
Output of higher voltage;
Constant readiness for efficient operation;
Minimum self-discharge;
No ""memory effect"" - the possibility of regular small recharging;
No need for ""training"" after acquisition;
Wide operating temperature range, including frost resistance and heat resistance;
Efficiency of stored energy conservation;
Minimum weight and size;
Possibility of long-term storage and slight aging without regular operation;
Ease of maintenance and use.
Ecological compatibility.

1.9. Measures of state support for import substitution in the market of batteries and rechargeable batteries in 2014-2021

The development of import substitution in India took place in 2014. Then Western states imposed sanctions against India. In the context of international sanctions aimed, among other things, at limiting the possibility of purchasing high-tech equipment abroad and the dependence of the rupee exchange rate on various political provocations, India is faced with the need to reindustrialize the resource-based model of the economy and stimulate the development of its internal potential.

Import substitution policy can be implemented in the following areas:

The introduction of protectionist barriers to reduce the economic efficiency of imports (in relation to domestic economic sectors, import protectionist barriers are introduced to reduce competition with foreign suppliers and create a favorable environment for the development of import substitution in India).
Support at the state level for import-substituting industries through direct and indirect measures, including subsidies, preferential taxation, loans, etc. national products and reduce imports).

Often these methods are combined and applied together.

...

1.10. Problems in the implementation of the import substitution policy in the market of batteries and rechargeable batteries

Among the problems and barriers in the implementation of the import substitution policy in the market of batteries and rechargeable batteries, the following can be noted:

...

The pandemic has also noticeably diverted attention from the process of import substitution. When the question is how to quickly solve the urgent problems facing the organization, research work and projects for the future are not so important.

It should be noted that many problems in the implementation of the import substitution policy and the reasons for the lack of proper results in import substitution in the market of batteries and rechargeable batteries are the same as in the case of any high-tech production.

1.11. The results of import substitution of batteries and storage batteries for the period 2014-2021

...

Indian battery manufacturers whose products are listed in the import-substituting catalog:

...

Part 2. Import substitution in the battery and rechargeable batteries market from 2022. Background, directions, expected results

2.1. Impact on the battery and battery market of the sanctions adopted in 2022

Against the backdrop of India's special operation in Ukraine, India came under numerous new sanctions, predominantly from Western countries, which exposed the country's significant dependence on high-tech imports from a number of industries. Among them are bans on the supply of new technologies, element base and components to India, which requires import substitution, including in the production cycle of batteries.

Among the imposed sanctions measures in terms of the studied product:

...

Also, in support of the policy of foreign countries, a number of foreign manufacturers of the studied products announced the suspension of supplies or withdrawal from the Indian market. According to the Catalog of sanctioned goods presented on the ETP GPB website and a link to which is posted on the GISP portal, the following manufacturers of the studied products announced the suspension of supplies or withdrawal from the Indian market:

...

In addition, with the introduction of restrictions, serious problems arose with the supply of raw materials and components to India. Of particular concern is the supply of one of the main raw materials for the domestic production of lithium-ion batteries (see section 2.5).

In connection with sanctions and restrictions, it is expected:

A significant reduction in the volume of foreign deliveries.
Departure from the Indian market of many Western companies.
Breaking supply chains.
Higher price growth for Western counterparts than for batteries from Indian manufacturers.
Problems with the supply of raw materials and components.

2.2. Evaluation of the number of buyers and their financial capabilities. Assessing the prospects for consumer demand up to 2026

Direct buyers in the market of accumulators and accumulator batteries are:

B2C segment.
B2B segment, including industrial.
B2G segment, including civil and military.

The dynamics of the development of the B2C segment and the B2B segment in the consumer sectors is largely related to the level of effective demand and the level of income of the population.

Areas of application for batteries:

Industry: industrial batteries, highly specialized industrial devices.
Traditional fossil fuel vehicles: cars, motorcycles, water transport, air transport, ship and aviation equipment, railway transport and machinery, construction and agricultural vehicles, specialized sports vehicles, etc.
Automation systems.
Electric transport and railway transport: trams, trolleybuses, electric trains, metro, electric cars, individual vehicles, etc. New, innovative models of municipal transport. One of the key areas in the ecology of the urban environment.
Uninterruptible power supplies. Wide range of applications: data centers, banks, medical institutions, office and shopping centers, airports, industrial plants, suburban real estate, etc.
Energy and communications: substation equipment (operating DC systems), telecommunications equipment, reclosers, relay protection, mobile systems, cellular communications, Internet, digital TV, etc. This scope refers to the offline and online sides of the busy life of a modern person.
Security and fire systems: video surveillance systems, access control and management systems, light and sound warning systems, etc.
Electric traction equipment: floor cleaning equipment, warehouse and construction equipment, equipment for distribution and shopping and entertainment centers, etc., support for people with disabilities, other equipment that ensures the smooth functioning of businesses, the comfort and convenience of the consumer's pastime.
Alternative energy: wind turbines, solar panels, greenhouse equipment, etc. Return to mainstream energy sources as new incentives for market mechanisms. Clean energy has recently received special attention at the global level.
Engineering infrastructure: protection and communication systems, power supply, heat supply, water supply and air conditioning of commercial, social, private, industrial buildings and structures, technical and utility rooms.
Consumer electronics.
Medical equipment.
Robotics.
Education and science.
Hobbies for life: Boats and boats, motorhomes, golf carts, electric scooters and electric toys, etc.
Other areas of application.

...

Energy accumulation (storage) systems are a rapidly developing class of high-tech devices that open up fundamentally new opportunities for the development of the electric power industry. They make electrical energy storable and portable, removing the need for strict simultaneity in the processes of its generation and consumption - that fundamental limitation on ensuring the balance of power, which was a key factor in the formation of the modern architecture of power systems operating around the world. Electricity storage is a fundamentally new element of their architecture, organically complementing the objects of generation, transmission and consumption and opening up wide opportunities for the effective implementation of the potential of new types of distributed generation, the creation of active consumers, increasing the efficiency of using already commissioned and new energy capacities and the operation of energy systems as a whole , as well as allowing you to move to their completely new architectures.

...

Demand in the battery and rechargeable battery market to a certain extent depends on the general demand of the population for goods and services. The population size and its real incomes are the main indicators characterizing the demand of the population.

Population.

...

The natural decline in the population has accelerated in India by one and a half to two times. Moreover, even before the pandemic, it was not possible to ensure natural population growth. But, as demographers explain, the last few years (before the pandemic) depopulation was due to a drop in the birth rate.

...

The real incomes of the population determine the level of solvent demand. The diagram below shows the dynamics of the growth rate of this indicator.

...

GidMarket estimates that consumer demand for batteries and rechargeable batteries will continue to grow in the long term, especially in the modern electronics and electric transport sectors and other growing sectors of the Indian economy.

The global battery market is fragmented, the market is highly competitive without a significant share of the main market players.

Among the main foreign players in the global market:

...

In the Indian Batteries & Batteries market, based on 2021 results, the top 10 largest foreign competitors include ...

...

XXX

...

XXX

...

XXX

...

Most of the main foreign competitors of the studied market specialize in the production of lead-acid batteries for cars and other types of transport. Also among the main competitors are foreign manufacturers producing lithium-ion batteries.

...

Directions for import substitution:

Lead-acid batteries for bulk foreign vehicles, widely used in the Indian market and running on traditional fuels.
Lithium-ion batteries.
Criteria for successful import substitution:
Import-substituting products must meet the requirements of a rapidly changing market and trends in the global battery and rechargeable battery market, namely:
changing market requirements
increasing demand for more power
high environmental standards of production using advanced environmentally friendly production technologies.
Availability of both production and processing facilities.
Compliance with advanced standards (European, Japanese).

2.4. Assessment of the potential of domestic production as an alternative to imports at present

Today, import substitution is turning from a political course into an urgent economic necessity. Without substitution of a part of imports by domestic batteries, there may be a shortage of supply in the market under study.

...

2.5. Assessment of the availability of a raw material base, assessment of the possibility of importing the main raw materials for the production of batteries and rechargeable batteries

Many raw materials for the production of batteries are imported into India, the industry is dependent on imports. Also, most of the necessary battery components, such as housings, cathode and anode strips, separators, conductors, are mainly imported from India.

However, for the main lead-acid batteries produced in the country, the key components are manufactured in India. Subject to the reorientation of the raw materials market from export supplies to the domestic market, there is a possibility of complete provision of the production of lead-acid batteries with domestic raw materials.

As for lithium batteries, which are actively developing both in the world and in India, in this area Indian manufacturers are completely dependent on import supplies, there are high risks of a shortage of raw materials and interruptions in their supply.

The main materials used in the production of batteries and the supply of raw materials for the Indian battery industry are presented in the table below.

...

For the production of lithium-ion power supplies, the main constituents are lithium, nickel and cobalt. The demand for raw materials for lithium-ion batteries is growing rapidly, and raw materials prices are rising. Lithium prices are growing most significantly – according to the results for 2021, a 4-fold increase (for more details, see Section 1.10).

There is a growing demand for other raw materials for lithium-ion and other advanced batteries. Rising raw material prices have reduced costs, which battery manufacturers have been working hard to reduce thanks to their technological capabilities. Demand in the global and Indian markets for key minerals for advanced batteries is expected to continue strong growth as a result of current trends.

Due to the fact that the amount of metals in nature is limited, there may be problems with the lack of raw materials.

There are currently three main classes of cathode materials used in the mass production of lithium-ion batteries:

lithium cobaltate LiCoO2 and solid solutions based on isostructural lithium nickelate
lithium-manganese spinel LiMn2O4
lithium ferrophosphate LiFePO4.

India's lithium problem

Lithium is a key component of a variety of modern batteries, without which it is impossible to imagine the development of modern electronics (lithium batteries are used everywhere: from smartphones to electric vehicles). Lithium is a globally strategic material, one of the most demanded metals in the chemical industry and energy, including nuclear. Its various compounds are used in metallurgy, optics, and electronics. After the active development of electric vehicles, the demand for lithium has increased dramatically.

...

There are processing capacities in India: lithium processing is carried out by the Chemical and Metallurgical Plant in Krasnoyarsk, the Novosibirsk Plant of Chemical Concentrates (part of the Rosatom group) and TD Halmek LLC in the Tula region.

Lithium Mining Opportunity in India

India has large reserves of lithium, but has not mined it for more than 20 years, preferring cheaper imports. ...

2.6. Cases of import substitution projects in the analyzed industry

Import substitution projects in the analyzed industry are implemented by domestic manufacturers of power supplies. Also, active actions in the field of import substitution, including in the market of batteries and storage batteries, are carried out by the State Corporations Rostec and Rosatem.

...

There are lithium processing plants in India. In addition to KHMK and Halmek, in India, the processing of lithium is carried out by the Novosibirsk plant of chemical concentrates, which is part of Rosatom. Used lithium batteries are recycled at two enterprises: the National Ecological Company (NEC) in Yaroslavl and Megapolisresurs in Chelyabinsk.

2.7. Measures of state support aimed at import substitution in the industry, proposed by the government for the current date

The main current instruments of state regulation aimed at stimulating the process of import substitution in India:

...

The Special Investment Contract (SPIC) is an industrial policy instrument aimed at stimulating investment in industrial production in India. The mechanism is available in two versions:

...

In the system of Indian legislation, a number of regulatory legal acts have been adopted aimed at strengthening import substitution. The Ministry of Industry and Trade of India approved plans for the development of import substitution in 24 industries, including the Plan for Import Substitution in the Radio-Electronic Industry (approved by Order of the Ministry of Industry and Trade of India dated May 31, 2018 N 2102), the Plan for Import Substitution in the power engineering, electrical and cable industries (approved by order of the Ministry of Industry and Trade of India dated 02 July 2021 N 2422), as well as in the plan for import substitution in the raw materials industry for the battery industry - non-ferrous metallurgy.

The main current state documents of India that contribute to the process of import substitution in the country as a whole, and import substitution in the Indian market of batteries and storage batteries in particular, are presented in the tables below.

...

The text below provides brief information on individual current programs in the field of import substitution in the market of batteries and rechargeable batteries.

Action plan for import substitution in the power engineering, electrical and cable industries of India

In terms of battery products, this import substitution plan includes:

Systems for the accumulation and storage of electrical energy using batteries manufactured in India
Lithium ion batteries
Flow batteries based on redox systems
Industrial sealed lead-acid batteries with valve control and immobilized electrolyte (except for those used for vehicles)
Batteries produced by EFB (use of liquid electrolyte with improved performance), AGM (use of liquid electrolyte absorbed into porous glass fiber separators), GEL (use of gel electrolyte) technologies.

...

Also, the Action Plan for import substitution in the power engineering, electrical and cable industries of India includes raw materials and materials used in the production of batteries and rechargeable batteries, which also stimulates the processes of import substitution in the studied market.

...

Against the background of the current geopolitical situation, in order to increase the dynamics of import substitution, the Government is considering new measures of state support. In addition, market access measures for alternative technologies are used, as Indian goods are often produced on imported production lines.

...

2.8. Difficulties in implementing import substitution in the battery and rechargeable batteries market starting from 2022

The main problems in the implementation of the import substitution policy in the market of batteries and rechargeable batteries are presented in Section 1.10. Starting from 2022, in connection with the actions in Ukraine and subsequent new international sanctions, additional difficulties arose in the implementation of the import substitution policy in the market under study:

Sanctions aimed at the products of the studied market, raw materials and components, and technological areas.
Supply chain disruption.
Increased competition from Asian manufacturers due to the departure of a number of European players.
The current exchange rate of the Chinese yuan, which creates conditions for expansions from China. Since March 2022, the yuan has fallen to 8 yuan per rupee.
Some leaders have a goal not to achieve economic independence, but to transfer industry and the economy to a new “Chinese needle”, changing logistics and investors.
Possible shortage of components.
The risk of a shortage of lithium raw materials (lithium carbonate) due to the departure of the largest suppliers - Chile and Argentina (see section 2.5). At the same time, in the short term, India will not be able to compensate for the lack of its own production of lithium raw materials (currently not mined).
Rising prices for raw materials.
Suspension of the work of a number of enterprises in the battery end-use industries. So, after the auto industry stopped, the demand for batteries dropped significantly, and the demand for raw materials for car batteries also fell (according to Kommersant's information, almost by half).
Increasing insufficiency of investment resources.
Increase in the cost of using credit funds due to an increase in the refinancing rate.
Forced transition of suppliers to full prepayment.
Rising prices for domestic products due to interruptions in the supply of imported raw materials, materials and components.
The outflow of highly qualified specialists abroad. Growing demand for specialists may further exacerbate the shortage of staff.
Currency jumps.
Growing shortage of production capacity.
The problem of supplying advanced Western technologies and modern high-tech imported equipment.

2.9. Alternative countries for importing batteries and storage batteries to India. Advantages and disadvantages

On March 5, the Government of India approved a list of foreign states and territories that commit unfriendly actions towards India, Indian legal entities and individuals. The list includes 22 countries of the world, as well as 27 states of the European Union. Countries not included in this list are considered by the Indian authorities as friendly or neutral.

Diagram 33. Dynamics of the share of imports of friendly and unfriendly countries (by current status), 2013–2021, %

From 2022, supplies from unfriendly countries may be significantly reduced. Among the unfriendly countries with the largest share of imports are South Korea, Germany and the Czech Republic. Their share in total is more than 20% of imports - almost half of the deliveries from unfriendly countries. Imports of accumulators and rechargeable batteries from unfriendly countries in the amount of ... mln USD may be subject to the risk of interruptions in supplies.

The top 3 importers of batteries and rechargeable batteries among friendly countries are...

...

Thus, China and Vietnam can be the main alternative countries for importing batteries and rechargeable batteries.

Benefits of redistributing imports to alternative countries:

Solving the problem of shortage of supply in the studied market in the shortest possible time.
Establishing new alternative supply chains.
Possibility to choose the most approximate analogue.
Keeping the quality of the product at a minimum level.
Keeping prices due to the continuing level of competition.
Disadvantages of redistributing imports to alternative countries:
Continued dependence on external supplies.
Failure to use the opening opportunities for the development and expansion of domestic production.
Possibility of lower quality and unjustified price increase.

2.10. Forecast of imports of batteries and rechargeable batteries until 2026

According to GidMarket, with active actions in the field of import substitution, the import of accumulators and accumulator batteries ...

...

2.11. Possible directions and expected results of import substitution in the market of accumulators and rechargeable batteries in the future until 2026

The following main trends and trends have been noted in the battery and rechargeable battery market:

Decarbonization of the economy both in India and globally. According to Bloomberg, the new era of cleaner energy will be driven by advanced battery technologies that will become available at much lower prices. Growth in the use of renewable energy. The use of solar photovoltaic energy storage is gaining popularity in developed countries, which is likely to create huge opportunities for the battery market in the near future.
Growing use of electric vehicles.
Growth in the use of gadgets and all kinds of consumer electronics.
Increasing use of stationary batteries.
Internal combustion engine (ICE) vehicles were the only types used previously. However, technology is currently shifting towards electric vehicles (EVs) due to growing environmental concerns. Lithium-ion batteries are mainly used in electric vehicles because they provide high energy density, low self-discharge, lighter weight and low maintenance.
For ICE vehicles, the lead battery is widely used and is expected to remain the only viable mass market battery system for the foreseeable future. For SLI applications, lithium-ion batteries still require a higher cost to be considered a viable mass market alternative to lead batteries.
The automotive battery segment is expected to witness significant demand in the global battery market over the medium to long term.
Lithium-ion battery systems power plug-in hybrid and electric vehicles. Lithium-ion batteries are the only technology available that can meet OEM requirements for vehicle range and charge time due to their high energy density, fast recharge and high discharge capacity. Lead-based traction batteries are not competitive for use in full hybrid electric vehicles or electric vehicles due to their lower energy density and higher weight.

Robotization.

Personal comfort and ubiquitous use of the Internet and gadgets.

Increased attention to local culture and producers.

Demand for lead-acid batteries is expected to gradually taper off as both the global and Indian markets continue to see structural changes in favor of lithium batteries.

Compared to traditional lead-acid batteries, lithium-ion batteries can deliver more power and have a longer lifespan. However, lithium has two big disadvantages. First of all, this is the price, which is growing due to an increase in demand for the material. Also, lithium-ion batteries depend on the external environment - they lose efficiency after a thousandth charge cycle, ignite easily, give out low power at low temperatures, and are expensive during transportation.

In this connection, the demand in the sector of lead batteries in the Indian market will remain in the medium term, experts assess the economic feasibility of import substitution projects in this sector.

...

Part 3. Forecasts and conclusions

3.1. Forecast of the battery and rechargeable batteries market until 2026

The battery and rechargeable battery industry is one of the fastest growing industries globally and the growth trend will continue for the forecast period.

Main market growth drivers:

The growth in the use of electric vehicles is a key driver of market growth.
Decarbonization.
Reduction of production costs due to new efficient technologies.
Rising use of consumer electronics, gadgets, wireless appliances and equipment. Phones, laptops, drones and everything in between are powered by lithium-ion batteries.
Mass industrial development of lithium-ion batteries, acting as a kind of building blocks of the most common SNE today.
The main barriers to market development:
High uncertainty due to the geopolitical situation and the risk of falling economies.
The mismatch between demand and supply of raw materials for the production of batteries will hinder the development of the market.
Rising prices for lithium-ion batteries.

...

3.2. Forecast of the share of imported products in the market of batteries and rechargeable batteries until 2026

According to GidMarket estimates, the share of imported products in the market of accumulators and rechargeable batteries will decrease from ...% in 2021 over the period under review.

...

3.3. Study Conclusions

The electronics industry is the backbone of India's technological development and is critical to ensuring all aspects of the country's sovereignty, security and development, incl. to implement the national course for the transition to a digital economy.

In turn, the battery industry, which is an integral part of the electronics industry, plays a crucial role in the development of the modern electronics industry.

In addition, experts see the battery industry as ""a foundation for the ongoing industrial revolution"" as ""their development and production play a strategic role in the ongoing transition to clean energy systems.""

...

In addition to those listed above, among the reasons for the need for further import substitution in the market of batteries and rechargeable batteries for the period up to 2026, one can single out:

...

Many of the technologies that affect the quality of the product are better developed abroad, but now is a good time to raise Indian production and develop technological processes to world standards.

...

Diagrams

Diagram 1. Dynamics of the market volume of accumulators and rechargeable batteries, 2013–2021, billion Rs.

Diagram 2. Dynamics of the share of imported products in the market of batteries and rechargeable batteries, 2013–2021, %

Diagram 3. Dynamics of the volume of imports of batteries and rechargeable batteries, 2013–2021, thousand tons

Diagram 4. Dynamics of imports of lead-acid batteries of various types, 2014–2021, million units

Diagram 5. Dynamics of imports of lithium-ion batteries, 2014–2021, million units

Diagram 6. Dynamics of imports of other batteries of various types, 2014–2021, million units

Diagram 7. Dynamics of the volume of imports of accumulators and rechargeable batteries, 2013–2021, billion Rs.

Diagram 8. Structure of imports of the main types of batteries and rechargeable batteries in 2014 and 2021, billion Rs.

Diagram 9. Dynamics of the volume of imports of batteries and rechargeable batteries from non-CIS countries and CIS countries, 2013-2021, billion Rs.

Diagram 10. The structure of the volume of imports of batteries and rechargeable batteries from non-CIS countries and CIS countries in 2021,%

Diagram 11. Structure of imports of the main countries with a share of more than 5% in 2021%

Diagram 12. The structure of imports of the main countries with a share of imports of 5% or more based on the results for 2013, %

Diagram 13. Dynamics of the volume of exports of batteries and rechargeable batteries, 2013–2021, thousand tons

Diagram 14. Dynamics of the volume of exports of batteries and rechargeable batteries, 2013–2021, billion Rs.

Chart 15. Shares of the top 5 exporting countries of batteries and accumulator batteries by results for 2021, %

Chart 16. Shares of the top 5 exporting countries of batteries and accumulator batteries by results for 2013, %

Diagram 17. Dynamics of the volume of domestic production of batteries and rechargeable batteries, 2013–2021, billion Rs.

Chart 18. Shares of types of batteries and rechargeable batteries produced in India, 2021, %

Diagram 19. Dynamics of domestic production of lead-acid batteries, 2013–2021, million units

Diagram 20. Dynamics of domestic production of nickel-cadmium, nickel-metal hydride, lithium-ion, lithium-polymer, nickel-iron and other batteries, 2013–2021, mln.h.

Diagram 21. Dynamics of the volume of domestic production of primary cells and batteries of primary cells, 2017–2021, million units

Diagram 22. Consumption of batteries and rechargeable batteries per capita, 2013-2021, Rs./person

Diagram 23. Structure of countries producing batteries and rechargeable batteries imported to India in 2021, grouping by country status, %

Chart 24. Demand structure of the global battery and rechargeable battery market by application segments in GWh, 2020-2021, %

Diagram 25. Forecast of the demand structure of the global market for batteries and rechargeable batteries by application segments in GWh, 2022 and 2030, %

Diagram 26. Population dynamics in India, as of 01 Jan. 2010–2022, million people, %

Diagram 27. Population forecast in India for 2023, million people

Chart 28. Dynamics of real incomes of the population of India, 2013–2022, available period, %

Diagram 29. Dynamics of the index of average prices for imports of batteries and storage batteries of all types, 2017–2021, %

Chart 30. Dynamics of the index of average import prices of lead batteries used to start piston engines, 2017–2021, %

Chart 31. Dynamics of the index of average import prices of lithium-ion batteries, 2017–2021, %

Chart 32. Dynamics of the Chinese yuan against the rupee from 01.01.2022/25.06.2022/ to / /

Diagram 33. Dynamics of the share of imports of friendly and unfriendly countries (by current status), 2013–2021, %

Diagram 34. Forecast of imports of accumulators and rechargeable batteries until 2026, billion Rs.

Diagram 35. Forecast of imports of lead-acid batteries until 2026, billion Rs.

Diagram 36. Forecast of imports of lithium-ion batteries until 2026, billion Rs.

Diagram 37. World fleet of electric vehicles for 2014-2020, million units

Chart 38. Forecast of the Indian battery and rechargeable battery market, 2022-2026, billion Rs.

Diagram 39. Forecast of the share of imported products in the market of batteries and rechargeable batteries until 2026,%

Figure 40. Electronics industry

Diagram 41. Forecast of domestic production of lead-acid batteries until 2026, billion Rs.

Diagram 42. Forecast for supplying the market sector of lead batteries with domestic products until 2026, %

Diagram 43. Forecast of domestic production of lithium-ion batteries until 2026, billion Rs.

Diagram 44. Forecast of provision of the sector of the market of lithium-ion batteries with domestic products until 2026, %

Tables

Table 1. Main pros and cons of import substitution in India

Table 2. Stages of development of the main types of batteries

Table 3. Dynamics of the import structure (in monetary terms) by types of batteries, 2014-2021, %

Table 4. Dynamics of the structure of imports by countries (the list includes countries with imports of more than 1% based on the results for 2021), %

Table 5. Dynamics of the structure of imports by countries (the list includes countries with imports of more than 1% based on the results for 2013), %

Table 6. Dynamics of the import structure by types of batteries, 2014-2021, %

Table 7. Dynamics of the structure of domestic production by types of batteries, 2017-2021, %

Table 8. Documents approving plans for import substitution of batteries and rechargeable batteries in 2014-2021

Table 9. The import substitution plan for batteries and rechargeable batteries in accordance with the Order of the Ministry of Industry and Trade dated March 31, 2015 N 653 (no longer valid)

Table 10. The import substitution plan for batteries and rechargeable batteries in accordance with the Order of the Ministry of Industry and Trade dated April 16, 2019 N 1327

Table 11. TOP 10 major manufacturers of imported batteries and rechargeable batteries in the Indian market

Table 12. The share of imports of the main (with an import share of more than 1%) manufacturers of foreign batteries and rechargeable batteries represented in the Indian market, %

Table 13. Share of imports of major (more than 1% import share) foreign brands of batteries and rechargeable batteries in the Indian market, %

Table 14. Basic information about the market participant XXX, %

Table 15. Basic information about the market participant XXX, %

Table 16. Basic information about the market participant XXX, %

Table 17. Basic information about the market participant XXX, %

Table 18. Basic information about the market participant XXX, %

Table 19. Basic information about the market participant XXX, %

Table 20. Basic information about the market participant XXX, %

Table 21. Basic information about the market participant XXX, %

Table 22. Basic information about the market participant XXX, %

Table 23. Basic information about the market participant XXX, %

Table 24: Raw materials endowment of the Indian battery industry

Table 25. Case studies of import substitution projects in the field of battery production in India

Table 26. Cases of import-substituting projects in the field of development of own raw material base for the production of batteries in India

Table 27. Main current documents in India that promote the process of import substitution of batteries and rechargeable batteries

Table 28. Products in the part of the studied market, included in the Import Substitution Action Plan (according to the Order of the Ministry of Industry and Trade of India dated July 02, 2021 N 2442)

Table 29. The main directions of the Concept for the development of production and use of electric road transport in India in the field of import substitution of batteries and rechargeable batteries, approved by the Order of the Government of India dated August 23, 2021 No. 2290-r

Table 30. Possible directions of import substitution

Table 31. Forecast indicators of the development of the Indian economy (CMASF forecast March 2022)

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