Battery firm plans $1 billion lithium-ion plant in India

New Delhi: International Battery Company has committed to investing $1 billion in India's southern Karnataka state to build a factory that will produce lithium-ion cells, the provincial government said Tuesday.

The privately owned company, which is making some initial batches of its prismatic or rectangular cells in South Korea, will acquire 100 acres of land close to the technology hub of Bangalore to build its plant.

"IBC plans to begin production by 2025," Gunjan Krishna, commissioner at Karnataka's Industries and Commerce Department, told Bloomberg News. "They will be eligible for financial incentives after they start production."

The company will start small, but is aiming to ramp up capacity to 10 gigawatt by 2028, Krishna added.

Prismatic batteries, typically rectangular, have increasingly become common in cars as they help automakers cut expenses due to their dense packing.

Even though combustion-engine vehicles remain the favored mode of personal transport in India, New Delhi is trying to accelerate a shift to green vehicles. That has also led states such as Karnataka to woo companies with quick decision-making, by cutting down on red tape and throwing in subsidies.