What Does Having A Lithium Reserve Mean For India

Earlier this year, a 5.9 million ton lithium reserve was found in Jammu & Kashmir. Here's why it is a big deal

Almost every story about the Indian auto industry will tell you it is a key market for automobile manufacturers, one that is growing quickly. And in recent years, the market has started shifting towards electrified vehicles and a focus on localised production of its most expensive aspect: batteries. One of the biggest developments in that regard has been the recent discovery of lithium reserves in Jammu & Kashmir, an estimated 5.9 million tonnes of it!

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Lithium is an essential material used in the making of batteries for electric vehicles. Most EVs in the world use lithium-ion batteries. But what exactly does a reserve of unharvested lithium mean for the Indian auto and energy industry? Here are five things that could happen if we use this reserve carefully:

Reduce Dependency On Imports

As of now, car manufacturers in India are dependent on importing entire lithium-ion batteries or even just lithium from different countries. Importing anything has a major cost to it, supplemented by import tariffs. This makes lithium expensive, which in turn makes the EV batteries a very costly part on an electric vehicle.

Reduce The Cost Of EVs

Cutting down our dependency on importing lithium (or EV batteries) by using our own reserves will reduce the cost of making EV batteries. Cheaper batteries means lower input costs for EVs, and the car manufacturers will pass on the benefit to buyers by making EVs more affordable without a range compromise. At present, EVs carry a massive premium compared to their ICE (internal combustion engine) alternatives. Even the high-volume Tata Nexon EV has a premium of up to Rs 6.24 lakh over its corresponding petrol-AMT variants.

Increase Battery Production

With the large reserve of raw material, there should be an uptake in battery production as well with new businesses joining the fray. We will be able to rapidly ramp up the production of EV batteries in the country. This would lead to a significant increase in the production of electric cars as well and we would see a lot more EVs on the roads.

Turn The Tables, Become An Exporter

India is not the only country dependent on lithium imports and by managing the newfound reserves, it can become an exporter to those countries. By positioning itself as an alternative to the current top exporters of battery-grade lithium like China, Chile or Australia, this could create another source of income for the country and help boost the economy.

Quicker Transition Towards Sustainability

The main reason for the world’s shift towards electrification and alternative energy is to reduce our dependence on depleting oil reserves. Another advantage is that it will help reduce the pollution generated by everything that uses fossil fuels for operating, by running on electricity instead. If the Indian industry can achieve all of the above uses of these lithium reserves in a responsible manner, it could hasten our progress towards a sustainable future.

• Electric cars In India
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The success of the above-stated goals is no easy task. The reserves we have found need to be handled responsibly and used with utmost care, as lithium is also a precious and finite natural resource. It will also take time to mine and convert into a usable quality and should be done in an eco-conscious and efficient manner. Only then will India be able to become one of the leading automobile manufacturing hubs in the world.