India's policies for electric vehicles must focus on de-risking supply chains by promoting a more self-reliant ecosystem, the Economic Survey 2024-25 said on Friday highlighting China's global dominance over key components and raw materials in the sector. The pre-Budget document also asserted that India must aim to establish technology transfer agreements with other nations that are also seeking to diversify their supply chains and forge partnerships with other aspiring nations to help distribute the high costs of securing a comparative advantage in the global market.

While India has made impressive strides in promoting domestic manufacture of electric vehicles (EVs), to sustain the growth momentum, there are some important considerations to keep in mind, it pointed out, citing an example of the requirement of six times more minerals to produce an EV as compared to a conventional car.

"Going forward, policies for electric vehicles must focus on de-risking supply chains by promoting a more self-reliant ecosystem powered by increased R&D in advanced battery technologies, such as sodium-ion and solid-state batteries," it asserted.

The survey further said,"Securing intellectual property in this domain can prove invaluable. Additionally, facilitating investment in battery recycling infrastructure can yield greater long-term gains for the Indian automotive sector."

Stressing on the need to de-risk the EV supply chain, the survey said many minerals crucial to EV manufacturing are scarcely available or processed in India while simultaneously being concentrated in very few countries.