India's EV Transition Could Support 7.2 Million Direct Jobs by 2040 if Battery Manufacturing Is Localized: ICCT Study

India's transition to electric vehicles could support 7.2 million direct manufacturing jobs by 2040 if the country builds its own battery cells, according to a study released on September 1, 2026, in New Delhi by the International Council on Clean Transportation (ICCT) and IIM Bangalore, launched at the 4th edition of the annual India Clean Transportation Summit (ICTS) 2026.

The study, titled "Employment implications of vehicle electrification under alternative fuel efficiency pathways in India," was produced by ICCT and the TCI-IIMB Supply Chain Sustainability Lab. It models three electrification pathways through 2040, ranging from currently notified fuel efficiency regulations to near-complete electrification across vehicle segments. Under the most ambitious pathway, EV-related economic output is projected to rise from $12.8 billion in 2024 to $620 billion by 2040, with annual EV production reaching 32 million vehicles.

Why Battery Localization Determines India's EV Job Gains

The study identifies battery cells as the highest-value component of an electric vehicle and finds that domestic cell manufacturing is the largest determinant of how much economic value India captures from the transition. Localized battery manufacturing could add nearly 2.9 million direct jobs over a pathway built on imported cells, alongside more than 17 million further jobs across supply chains.

The analysis also weighs jobs created in EV manufacturing against those lost or transferred from conventional engine, transmission and fuel-system production. It finds this balance turns positive only once domestic battery manufacturing crosses 25%; below that threshold, the transition displaces more manufacturing jobs than it creates across all three pathways.

India's Current Battery Capacity vs 2032 Localization Targets

India's domestic battery cell manufacturing capacity currently stands at approximately 1.4 GWh, meeting under 3% of projected 2032 battery demand across all scenarios. If the full announced pipeline of about 128 GWh is commissioned — comprising 50 GWh targeted under the Production Linked Incentive Scheme for Advanced Chemistry Cell Battery Storage and roughly 78 GWh of other announced automotive projects — India would exceed 30% localization by 2032 under every pathway.

What ICCT and Industry Researchers Are Saying

"Under the most ambitious scenario, India's EV transition could support over 7 million direct jobs in EV and battery manufacturing and more than 17 million indirect jobs by 2040," said Megha Kumar, Senior Researcher at ICCT and study co-author. "Achieving at least 30% battery localization by 2032 and 50% by 2040 will be critical to realizing this opportunity."

Aditya Gupta, Chief Operating Officer of the Supply Chain Management Centre at TCI-IIMB Supply Chain Sustainability Lab, said, "India can turn the transition to electric mobility into a major employment and industrial opportunity, but the gains will depend critically on how quickly we build domestic capabilities, particularly in battery manufacturing. The challenge is therefore not simply to create EV jobs, but to ensure that the workforce transitioning from the ICE ecosystem has the skills and opportunities to participate in this new economy."

Government's Electric Bus and Truck Financing Push

Speaking at the summit's opening plenary, Dr Hanif Qureshi, Additional Secretary at the Ministry of Heavy Industries, said the government is working on a financing mechanism to support 50,000 electric buses and 50,000 electric trucks over the next five years, noting that trucks make up barely 3% of the fleet, account for over 40% of emissions, and remain below 0.1% electrified.

Inside the India Clean Transportation Summit 2026

Rajesh Verma, Chairperson of the Commission for Air Quality Management, said the shift to clean air represents an economic opportunity that runs through domestic manufacturing of vehicles and batteries, in line with the Atmanirbhar Bharat and Viksit Bharat 2047 initiatives.

Amit Bhatt, India Managing Director at ICCT, said the summit arrives at a time when India is focused on energy security and self-reliance, with clean transport central to that goal.

The ICTS 2026 summit is themed "Driving an Atmanirbhar Bharat Through Clean Transport: Strengthening Energy Security, Manufacturing, and Sustainable Mobility," and is supported by the Ministry of Heavy Industries, the Commission for Air Quality Management, the Embassy of Denmark, the Raahgiri Foundation, EPIC India, and the Kerala State Electricity Board.