Reliance Industries Ltd. has paused its plans to manufacture lithium-ion battery cells in India after failing to secure crucial technology from a Chinese supplier, highlighting the challenges faced by Indian companies in building independent clean-energy supply chains.

Failed Technology Partnership

The Mukesh Ambani-led conglomerate had been in discussions with Chinese lithium iron phosphate supplier Xiamen Hithium Energy Storage Technology Co. to license cell technology. However, these talks stalled after the Chinese company withdrew from the proposed partnership amid Beijing's curbs on overseas technology transfers in key sectors.

Strategic Pivot to Battery Storage Systems

The setback has prompted Reliance to refocus on assembling battery energy storage systems (BESS) — containers for its own renewable power projects. The company had originally aimed to begin cell manufacturing this year as part of its broader green energy ambitions.

A Reliance spokesperson clarified that there is no change in the company's overall plans, stating that "BESS manufacturing, battery pack manufacturing and cell manufacturing have always been part of our energy storage plans and we are progressing well in their execution."

Impact on Green Energy Ambitions

In August, Mukesh Ambani told shareholders that Reliance's battery gigafactory will start in 2026. The richest person in Asia had announced four gigafactories in 2021 as part of a $10.00 billion investment push to pivot away from the empire's fossil-fuel origins.

Reliance's internal teams concluded that proceeding without access to proven Chinese cell technology would significantly raise costs and execution risks, particularly as global markets are already grappling with excess battery capacity. Alternative technologies from Japan, Europe and South Korea were assessed but deemed substantially more expensive and less competitive for large-scale deployment in India.

Industry-Wide Challenges

The pattern is mirrored across Indian conglomerates as they race to secure battery capacity to support rapidly expanding renewable power businesses. Adani Group and JSW Group, other powerful Indian conglomerates with ambitious clean energy plans, are also focusing on battery pack and container assembly rather than full-fledged cell manufacturing.

Government Incentive Program

In 2022, Reliance's renewable energy unit — Reliance New Energy — was one of three companies that won bids to build battery cell plants under a production-linked incentive program. The initiative offered manufacturers eligibility for as much as ₹181.00 billion ($2.00 billion) in subsidies tied to meeting project milestones aimed at creating a cumulative 30.00 gigawatt-hours of advanced chemistry cell capacity.

Reliance New Energy was penalized for missing deadlines under the program, demonstrating that current policy incentives are insufficient to create local manufacturing when the world is awash in cheap Chinese batteries.

Market Outlook

By 2035, India's energy storage market is expected to reach about 87.00 gigawatts of power capacity — more than 300 times what was installed in 2024, according to BloombergNEF estimates. This massive growth potential underscores the strategic importance of developing domestic battery manufacturing capabilities.

Reliance Industries Chairman Mukesh Ambani has unveiled an ambitious investment plan worth ₹7 lakh crore for Gujarat over the next five years. This massive financial commitment represents a significant expansion of the conglomerate's presence in the state, with a strategic focus on emerging technologies and sustainable development initiatives.

Investment Focus Areas

The comprehensive investment strategy encompasses multiple high-growth sectors that align with India's digital transformation and clean energy transition goals. The plan demonstrates Reliance Industries' commitment to doubling its investment in key strategic areas.

Strategic Significance

The ₹7 lakh crore investment commitment represents a doubling of funds allocated to these strategic sectors, indicating Reliance Industries' confidence in Gujarat's business environment and growth potential. The focus on clean energy and renewable power aligns with national sustainability goals and the company's transition toward greener business models.

Technology and Infrastructure Development

A significant portion of the investment will be directed toward building AI-ready data centers and enhancing digital infrastructure capabilities. This technological focus positions Gujarat as a potential hub for advanced computing and digital services, supporting the broader digital economy ecosystem.

The investment plan also includes substantial allocations for healthcare, education, and sports facilities, demonstrating a holistic approach to infrastructure development that extends beyond traditional business operations.

Implementation Timeline

The five-year implementation timeline provides a structured framework for executing this large-scale investment initiative. The phased approach allows for systematic development across multiple sectors while ensuring optimal resource allocation and project management efficiency.