The shares of Reliance Industries Limited were trading at ₹1,162.55 down by ₹37.55 or 3.13 per cent on the NSE today at 11.45 am and those of Rajesh Exports Limited were trading at ₹155 down by ₹4.22 or 2.65 per cent.
Reliance New Energy Ltd. and Rajesh Exports Ltd. are facing potential penalties of up to ₹125 crore ($14.3 million) each for failing to meet deadlines on battery cell manufacturing commitments under India’s Production-Linked Incentives (PLI) program, according to sources familiar with the matter.
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The companies won bids in 2022 as part of Prime Minister Narendra Modi’s initiative to reduce import dependence for electric vehicle components. Manufacturers were eligible for ₹18,100 crore in subsidies upon meeting project milestones, including achieving minimum capacity targets and local value addition of 25 per cent within two years.
While Ola Cell Technologies Pvt., the third company in the program, has made progress with trial production beginning in March last year and commercial production planned for Q2 2024, Reliance and Rajesh Exports have stalled their projects.
Industry analysts note that declining global lithium-ion battery prices have made imports cheaper, creating uncertainty around domestic demand. The capital investment required for lithium-ion battery plants is substantial, estimated at $60-80 million per gigawatt-hour.
Reliance has reportedly shifted focus toward green hydrogen initiatives, representing a change in the company’s priorities. Representatives for Reliance Industries, Rajesh Exports, and India’s Heavy Industries Ministry did not respond to requests for comment.