India Storage Alliance Calls for GST Cut on Batteries, Charging Infra

New Delhi, Jun 24 (PTI) Industry body India Energy Storage (IESA) has demanded that the government reduce the goods and services tax (GST) on batteries and electric vehicles charging infrastructure services as well battery swapping.

Ahead of the India Energy Storage Week 2024 (IESW) in New Delhi from July 1-5, 2024, the IESA also suggested expansion of production-linked incentive (PLI) schemes for battery components and battery raw materials processing industry, in a wishlist submitted to the government, a statement said.

"Lithium ion batteries current GST rate is 18 per cent and other batteries is 28 per cent. We want all batteries to come under the 18 per cent GST bracket. Charging infra services and battery swapping services should be reduced to 5 or 18 per cent from the existing 28 per cent," IESA President Rahul Walawalkar said in the statement.

He lauded the government for the initiatives like advanced chemistry cell battery (ACC-PLI), Auto-PLI, Auto Components PLI, etc.

He suggested further expansion of PLI schemes to battery components and battery raw materials processing industry, support for battery recycling initiatives, and collaboration with international partners to secure critical raw materials.

IESA urged the new government to continue incentivising the deployment of large-scale battery storage systems and to support research and development in this area to enhance performance and reduce costs.

While the EV market is growing, further support is needed to overcome barriers such as the lack of charging infrastructure and high upfront costs, the IESA said.

The recommendations also included streamlining regulatory processes and providing clear guidelines for clean energy projects which will help in faster implementation and reduce uncertainties for investors.

Access to affordable financing remains a major barrier for clean energy projects. Innovative financial mechanisms and incentives for private sector participation are essential.

Greater emphasis on research and innovation is needed to drive down costs and improve the efficiency of clean energy technologies, it stated, adding that public-private partnerships can play a vital role in this regard.

The industry body also suggested raising public awareness about the benefits of clean energy and investing in skills development programs.