Budget 2025 Gives Big Boost For Li-Ion Battery, EV Manufacturing In India

India has proposed to set up a National Manufacturing Mission and remove customs duty on critical minerals used in the manufacturing of lithium-ion batteries, in what is seen as a big boost for electric mobility in the world's third largest automotive industry.

"To the list of exempted capital goods, I propose to add 35 additional goods for EV battery manufacturing, and 28 additional capital goods for mobile phone battery manufacturing," Finance Minister Nirmala Sitharaman said while presenting the Union Budget 2025–26. "This will boost the domestic manufacturing of lithium-ion batteries, both for mobile phones and electric vehicles."

The government is also looking to boost lithium-ion battery recycling in India. To that end, the budget has proposed to exempt cobalt powder, scrap of lithium-ion batteries from customs duty.

The budget has also proposed setting up of a National Manufacturing Mission. It supports cleantech manufacturing, with the aim to improve domestic value addition and build a local  ecosystem for EV batteries, motors and controllers and high-voltage transmission equipment.