India’s EV Localisation Roadmap: Progress, Potential, and Key Challenges for 2030

Assessing India's potential to achieve 90-100% EV component localisation by 2030 and the obstacles to deeper value creation.

Priya24-Jun-26 11:25 AM

India’s EV Localisation Roadmap: Progress, Potential, and Key Challenges for 2030

India is making significant strides toward becoming a global hub for electric vehicle (EV) manufacturing. According to a comprehensive new report from the Institute for Energy Economics and Financial Analysis (IEEFA) and JMK Research & Analytics, the nation is on track to achieve 90–100% localisation across several high value EV component categories by 2030. However, achieving full supply chain resilience requires overcoming persistent challenges in the sourcing of semiconductors and rare earth magnets.

The Path to 2030: What is Localising?

The automotive sector has seen rapid progress in localising components that align with India’s traditional manufacturing strengths. Key areas currently gaining domestic momentum include:

Structural Components: Chassis and body parts.
Mechanical Systems: Advanced suspension and braking systems.
Wiring and Connectivity: Wiring harnesses and essential electrical distribution components.

The "Import Bottleneck": Why Semiconductors Matter

Despite the optimistic outlook, the report highlights a critical dependency on imported technology. Specifically, India continues to rely on global markets for:

Semiconductors (Chips): The "brains" behind EV traction motors and power electronics.
Rare-Earth Magnets: Essential for high efficiency electric motors.

Without domestic capacity in these areas, the industry faces limitations in "deeper" value creation, meaning that while the assembly is local, the high value technology often remains imported.

Policy Hurdles: The PLI Scheme Impact

The government’s Production-Linked Incentive (PLI) scheme was designed to accelerate this transition. However, the IEEFA and JMK report notes that by early 2026, less than 10% of the allocated ₹25,938 crore had been disbursed. Analysts suggest that accelerating the distribution of these incentives is vital to help manufacturers scale production and reduce the current reliance on external supply chains.

Conclusion

India’s roadmap to an electrified future is promising, but the next five years will be decisive. By focusing on semiconductor and magnet manufacturing, India can move from being an assembly led market to a technology led EV powerhouse.

Frequently Asked Questions

Q.1Can India achieve 100% EV component localisation by 2030?

Yes, according to the IEEFA and JMK report, India has the potential to achieve 90–100% localisation for many high-value EV components by 2030, provided that announced manufacturing projects are commissioned successfully.

Q.2What are the biggest hurdles to deeper EV localisation in India?

The primary barriers are a heavy reliance on imported semiconductors (chips) and rare-earth magnets, which are critical for motors and power electronics and are currently concentrated in markets like China and Taiwan.

Q.3Why does India still import so many EV components?

While India excels in manufacturing structural and mechanical parts (like chassis and suspension), it lacks domestic capacity for advanced electronics, high-precision processes, and upstream materials, forcing manufacturers to source these essential subcomponents from abroad.

Q.4How is the PLI scheme helping Indian EV manufacturing?

The Production-Linked Incentive (PLI) scheme has triggered significant industry interest, with about 60% of recent manufacturing announcements coming from PLI-approved companies. However, as of early 2026, less than 10% of the allocated funds had been disbursed, indicating a gap between project announcements and on-ground execution.

Q.5Which EV components are currently being localised in India?

India has seen strong progress in components aligned with its traditional automotive strengths, such as wiring harnesses, braking systems, suspension components, and structural parts. Newer investments are also scaling up for powertrains, power electronics, and charging infrastructure