Indian officials are currently in Taiwan to meet executives at contract manufacturer Foxconn and present the country as an attractive destination for electric vehicle (EV) manufacturing, people in the know told ET.
The delegation from the union government will also brief Foxconn on how India is exploring and evaluating potential reserves of minerals like lithium, nickel, manganese and cobalt, the sources said. Lithium is a critical mineral used in EV batteries.
“The presentation covers information about the production-linked incentives (available) for Advanced Chemistry Cell (ACC) battery storage as well as how India is building a resilient supply chain,” according to one person cited above, who said the delegation will also provide an overview of the country’s battery manufacturing sector.
Taiwan’s India Bet
ET had reported on Friday that the Taiwanese contract manufacturer plans to set up a production line for two-wheeled EVs in India.
Foxconn, best known as the maker of the iconic Apple iPhone, said that it will cooperate and strive with more than 1,500 member companies at home and abroad “to become the Android platform of the electric vehicle industry”, in its latest annual report released on May 31.
ET reviewed the report which for the first time spells out Foxconn’s plans for its EV foray into India. The company said the move would combine the group’s Build-Operate-Localise policy to cater to the electric two-wheeler market in Southeast Asia.
“Foxconn is being very aggressive,” Simon Lee, CEO at Wagon Group and the President of the Taiwan Chamber of Commerce in Chennai, told ET.
Lee estimates that “Taiwan’s direct foreign investment (in India) will go up 8x what it is today in the next five years”.
“There are conversations that happen here and there (about Foxconn’s EV component plans) but nothing concrete as of now. I don’t have specific details about Foxconn’s investment plans,” he added.
Sops for Battery Tech
India’s Department of Heavy Industries had notified the production-linked incentive scheme — the National Programme on Advanced Chemistry Cell Battery Storage (PLI-ACC Scheme) — in June 2021. The PLI-ACC Scheme aims to encourage domestic and foreign investors to invest in setting up giga-scale ACC manufacturing facilities in India.
In February, the Geological Survey of India said that it had discovered 5.9 million tonnes of lithium resources in the Salal Haimana area of Reasi district in Jammu and Kashmir. This was the first time that lithium reserves were found in India.
According to a report by the Federation of Indian Chambers of Commerce and Industry (FICCI), rare earth elements as well as battery minerals such as lithium, cobalt, nickel, and graphite form the core for new-age energy minerals. The demand for these minerals is going to witness a rising trend as India moves towards 2047.
In addition to Foxconn, other Taiwanese companies are also increasingly looking at India as a manufacturing destination.
Deepak Jain, Partner, Bain & Company, said that India’s large consumer market, favourable demographics, and government initiatives like “Make in India” have attracted several companies to invest in manufacturing facilities within the country.
“Future strategic importance of India to these players is likely to be contingent on sustained infrastructure development, ease of doing business, government incentives and the ability to address challenges across logistics, supply chain efficiency, and talent pool up-skilling and retention,” he said.
