Context: Union cabinet approved the Production Linked Incentive (PLI) scheme for manufacturing advanced chemistry cell (ACC) battery.

More in the news:

  • An estimated outlay of manufacturing is ₹18,100 crore.
  • Major battery consuming sectors includes which are expected to be benefitted are:
    • Consumer Electronics.
    • Electric Vehicles.
    • Advance Electricity grid.
    • Solar rooftop.
  • The outcomes/ benefits expected from the scheme are as follows:
    • Setup a cumulative 50 GWh of ACC manufacturing facilities in India under the Programme.
    • Direct investment of around Rs.45,000 crore in ACC Battery storage manufacturing projects.
    • Facilitate demand creation for battery storage in India.
    • Facilitate Make-ln-India: Greater emphasis upon domestic value-capture and therefore reduction in import dependence.
    • Net savings of Indian Rs. 2,00,000 crore to Rs.2,50,000 crore on account of oil import bill reduction during the period of this Programme due to EV adoption as ACCs manufactured under the Programme is expected to accelerate EV adoption.
    • The manufacturing of ACCs will facilitate demand for EVs, which are proven to be significantly less polluting. 
      • As India pursues an ambitious renewable energy agenda, the ACC program will be a key contributing factor to reduce India's Green House Gas (GHG) emissions which will be in line with India's commitment to combat climate change.
    • Import substitution of around Rs.20,000 crore every year.
    • The impetus to Research & Development to achieve higher specific energy density and cycles in ACC.
    • Promote newer and niche cell technologies.

Related Facts:

Production Linked Incentive (PLI):

  • It is a Ministry of Electronics and Information Technology’s (MeitY), Government of India, scheme.
  • As a part of the National Policy on Electronics, the scheme would give incentives of 4-6 per cent to electronics companies.
    • Who manufacture mobile phones and other electronic components such as transistors, diodes, etc, and nano-electronic components such as micro-electromechanical systems.
  • Tenure of the scheme: The PLI scheme will be active for five years with the financial year 2019-20 considered as the base year for calculation of incentives. 
  • Companies and investments to be considered for incentives: 
    • Companies: All electronic manufacturing companies which are either Indian or have a registered unit in India will be eligible to apply for the scheme. 
      • These companies can either create a new unit or seek incentives for their existing units from one or more locations in India.
    • Investments: Any additional expenditure incurred by companies on the plant, machinery, equipment, research and development and transfer of technology for the manufacture of mobile phones and related electronic items will be eligible for the incentive scheme.
      • However, all investment done by companies on land and buildings for the project will not be considered for any incentives or determine the eligibility of the scheme.
    • Significance: The scheme will on one hand attract big foreign investment in the sector, while on the other encourage domestic mobile phone and electronic goods makers to expand their units and presence in India.
    • The scheme will help in building a robust manufacturing ecosystem that will help offset the disability for domestic electronics manufacturing by providing state-of-the-art infrastructure.
    • The scheme will contribute significantly to achieving a USD 1 Trillion digital economy and a USD 5 Trillion GDP by 2025.
    • Employment generation: The government aims to manufacture electronics worth Rs. 8 lakh crore while generating employment for about 10 lakh people in the next five years.
  • The launch of the PLI scheme along with other electronics incentive schemes is an effort to promote the central government’s clarion call for Atma Nirbhar Bharat, a self-reliant India, to enhance its capacity and develop an ecosystem as an asset to the global economy.

Advanced Chemistry Cell (ACC) battery:

  • ACCs are the new generation of advanced storage technologies that can store electric energy either as electrochemical or as chemical energy.
  • It converts stored electric charge-back to electric energy as and when required.

Source: The Hindu, The Indian Express, PIB