China JVs Expected to Join India's Auto PLI Scheme for EV Production

Chinese joint ventures are expected to join India's Auto Production Linked Incentive (PLI) scheme, according to a report by ET Manufacturing. The move could give a push to electric vehicle manufacturing in the country.

The Auto PLI scheme, approved by the Union Cabinet in September 2021, has a total outlay of Rs 25,938 crore. It covers advanced automotive technology (AAT) products, including electric and hydrogen fuel cell vehicles. The scheme offers incentives of 13% to 18% on determined sales value of eligible products.

The report did not specify which Chinese joint ventures are expected to participate or the timeline for their entry. It also did not mention the names of the companies involved or the size of their planned investments.

India's auto industry has seen a slow but steady shift toward electric mobility. Several global automakers have announced plans to localise EV production in India, drawn by the PLI scheme and other policy support. Chinese firms have significant expertise in battery technology and EV manufacturing, and their participation could help accelerate technology transfer and local supply chains.

However, Chinese investments in India have faced scrutiny in recent years. The government has tightened rules for investments from countries sharing a land border with India, including China. Any Chinese joint venture joining the PLI scheme would need to comply with these norms.

The Auto PLI scheme has already attracted applications from major domestic and international automakers. The government has been reviewing progress and disbursing incentives to eligible companies. The addition of Chinese JVs, if it happens, would expand the scheme's reach and could boost EV output.

Industry watchers say the development signals a pragmatic approach to building India's EV ecosystem. They point out that Chinese firms are key players in the global EV supply chain, especially in lithium-ion batteries and components. Their involvement in Indian manufacturing could lower costs and speed up adoption.

Still, questions remain about how the government will balance security concerns with the need for technology and investment. The report did not address these issues.

ET Manufacturing's report did not provide further details. It is unclear when the joint ventures might formally apply or receive approval. The Ministry of Heavy Industries, which administers the Auto PLI scheme, has not issued a statement on the matter.

The story is developing. More information is expected as the government processes applications and companies finalise their plans.