India carmaker to buy EV batteries from Chinese firm to boost performance

China and India should enhance cooperation in the green transformation, as China's advanced production capabilities in electric vehicles (EVs) and related battery products align well with India's needs for its nascent EV industry and the fruitless "Make in India" initiative, Chinese experts said.

India's Tata Motors will reportedly source battery packs for its passenger EVs from Octillion Power Systems, a major battery pack maker, Indian news outlet Livemint.com reported on Wednesday, citing two people with direct knowledge of the matter. 

The reported move would end the practice of buying them solely from group company Tata AutoCompSystems, the report said.

Tata Motors' decision comes amid a challenging EV market for the company, and this shift aims to address performance issues, and diversify its supply and technology base, the report said.

Chinese companies lead the global EV market with their complete supply chain and advanced technology. To build a competitive edge in the green sector, India's best option is to collaborate with China, Qian Feng, director of the research department at the National Strategy Institute at Tsinghua University, told the Global Times on Thursday.

India holds a significant potential for the green transformation. However, EV market penetration remains minimal compared with internal combustion cars due to the higher cost of EVs, primarily driven by the battery pack, as reported by Indian media.

Octillion Power Systems has supplied more than 1 million battery systems to customers around the globe, according to the company's official website.

The move by the Indian carmaker shows that the market, rather than political factors, drives business decisions. Companies continue to pursue market-oriented approaches driven by demand and growth needs, Qian said.

A number of Chinese industry players, such as BYD, are doing business in India, either by exporting products or by forming partnerships with local companies, as the South Asian country pursues green development.

"It is hoped that Tata Motors' initiative will serve as the latest positive example for further cooperation between Chinese and Indian companies, supporting India's green transformation and the 'Make in India' initiative, which has been a failure, while offering new opportunities for Chinese companies in the Indian market," Qian said.