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Source — Source: TH ///Category — GS Paper 2 ///Published — 2026-02-14 ///Exam — Both Prelims and Mains ///Tags — Industrial Policy, Infrastructure, Government Policies & Interventions ///Source — Source: TH ///Category — GS Paper 2 ///Published — 2026-02-14 ///Exam — Both Prelims and Mains ///Tags — Industrial Policy, Infrastructure, Government Policies & Interventions ///

Source: TH · GS Paper 2

Advanced Chemistry Cell Production Linked Incentive Scheme

The Advanced Chemistry Cell Production Linked Incentive (ACC‑PLI) scheme, launched in October 2021, aims to build a domestic lithium‑ion battery ecosystem with a target of 50 GWh capacity by 2026 and an outlay of ₹18,100 crore. Implementation gaps have led to only 1.4 GWh commissioned, highlighting challenges in India's industrial policy and import‑substitution goals.

2026-02-14

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Source: TH

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Key Facts and Data Points

Launch: October 2021 by the Ministry of Heavy Industries.
Target Capacity: 50 GWh of advanced chemistry battery manufacturing by 2026.
Financial Outlay: ₹18,100 crore.
Incentive Rate: Up to ₹2,000 per kWh of battery sold.
Minimum Investment Requirement: ₹1,100 crore per manufacturer.
Domestic Value‑Addition (VA) Requirements:
25 % VA within 2 years.
60 % VA within 5 years.
Actual Progress (Oct 2025):
1.4 GWh commissioned.
8.6 GWh under development (delayed).
No incentive disbursement against the ₹2,900 crore target.
Employment: 1,118 jobs created vs. projected 1.03 million.

Background and Context

Advanced Chemistry Cells (ACC): High‑performance lithium‑ion batteries offering higher energy density, longer life, and faster charging compared to traditional lead‑acid batteries.
Policy Rationale: Reduce dependence on imports (especially from China), develop a complete battery value chain (cathode, anode, electrolyte), lower EV battery costs, and accelerate electric‑vehicle (EV) and energy‑storage adoption.
Production‑Linked Incentive (PLI) Framework: Launched in March 2020 to boost domestic manufacturing across 14 sectors by providing incentives linked to incremental sales and value addition.

Significance for India / Governance / Policy

Strategic Autonomy: A domestic battery ecosystem lessens strategic vulnerability to supply disruptions.
Economic Impact: Potential to generate large‑scale employment, attract foreign direct investment, and foster R&D in battery technologies.
Environmental Goal: Supports India's commitment to electric mobility and renewable‑energy storage, contributing to climate‑change mitigation.
Implementation Challenges: Delays highlight issues in project financing, land acquisition, technology transfer, and coordination between central and state governments.

Related Constitutional / Legal Provisions

Article 246 & Entry 42 of the State List: Allows the Union to legislate on "manufacture of goods for export" and "industrial policy".
Make in India Initiative (2014): Provides the broader legal‑policy framework under which PLI schemes operate.
Foreign Direct Investment (FDI) Policy: Enables 100 % FDI under the automatic route for high‑technology manufacturing, relevant for ACC‑PLI.

References

Ministry of Heavy Industries, Press Release (Oct 2021).
Government of India, Production‑Linked Incentive (PLI) Scheme – Official Portal.
Recent implementation report (Oct 2025).