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The Andhra Pradesh government has approved an INR 2,550 crore investment by NPSPL Speciality Chemicals to set up a cathode material manufacturing facility in Chittoor district. The project, spread over 105 acres, will support lithium-ion battery production used in electric vehicles, electronics and energy storage systems. Backed by incentives under the state's Electronics Component Manufacturing Policy 2025-30, the unit is expected to generate around 400 direct jobs. The move aims to reduce India's reliance on imports of critical battery materials and strengthen the domestic electronics and EV supply chain.
The Government of Andhra Pradesh has approved an investment of INR 2,550 crore by NPSPL Speciality Chemicals to establish a cathode material manufacturing facility in Chittoor district. The project will come up in Gudupalle Mandal across 105 acres and will focus on producing a key component used in lithium-ion batteries. Advertisement
Cathode materials play an important role in determining battery performance, including energy density, safety and lifecycle. These materials are widely used in electric vehicles, consumer electronics such as smartphones and laptops, and energy storage systems. Due to their importance, they remain a critical part of global battery supply chains, where availability is often concentrated in a few regions.
The project is aligned with India's broader push to reduce dependence on imports of critical materials and build domestic manufacturing capabilities in electronics and clean energy sectors. Over the past few years, India has been focusing on strengthening its battery ecosystem through policy support and production-linked incentives, especially as demand for electric mobility and storage solutions continues to rise.
Approved under the Andhra Pradesh Electronics Component Manufacturing Policy 2025-30, the project is among the initial set of investments cleared under the scheme. The state government, in an official communication, stated that it is actively working towards positioning Andhra Pradesh as a preferred destination for electronics component manufacturing. It added that the focus remains on building an ecosystem that supports innovation, scalability and global competitiveness in this segment.
As part of the approval, the project has been granted a customised incentive package. This includes a capital incentive of up to 60 per cent, 100 per cent exemption on electricity duty for 10 years, and power cost reimbursement of INR 2 per unit for the same period. The facility has also been classified as a high energy-intensive industry to support its operational requirements.
The plant is expected to generate around 400 direct jobs while also supporting indirect employment through the development of a wider supply chain. This includes linkages with electric vehicle manufacturing, battery production, electronics hardware and related chemical industries. Such projects are seen as important for building upstream capabilities in India's manufacturing ecosystem.
Cathode materials account for a significant portion of battery costs and are central to technological advancement in the sector. Developing domestic capacity in this segment helps reduce exposure to global supply risks and supports long-term industrial growth. The project is also among the first ten approved under the policy, giving it early-stage advantages in terms of incentives and ecosystem integration.
Source PTI
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