Rajesh Exports Controversy Adds Fresh Uncertainty to India’s ACC Battery PLI
India’s ambitious ₹18,100 crore ACC PLI scheme was designed to kickstart domestic advanced chemistry cell manufacturing and reduce the country’s heavy dependence on imported EV batteries. Yet, with only 2.8% of the targeted 50 GWh capacity installed so far, the scheme was already struggling with execution. The latest developments around Rajesh Exports threaten to make matters worse.
Rajesh Exports was one of the four original beneficiaries in Round 1, awarded 5 GWh (later transferred to its subsidiary ACC Energy Storage Pvt. Ltd.). The company had completed land acquisition, like the other winners. However, following SEBI’s interim order in early June 2026 alleging massive revenue inflation of nearly ₹15.15 lakh crore over five years, the Ministry of Heavy Industries is reportedly reviewing its continuation in the scheme. This comes on the heels of Hyundai Global Motors’ earlier withdrawal from a 20 GWh allocation.
Why This Matters Beyond One Company
At first glance, losing one 5 GWh beneficiary may seem manageable, especially since Reliance Industries has already secured an additional 10 GWh in Round 2. But the real damage lies in perception and momentum.
The ACC PLI was always a high-stakes bet. Beneficiaries were required to meet aggressive domestic value addition targets (25% in two years, scaling to 60% in five) while committing significant capital. When a beneficiary faces serious governance allegations, it raises uncomfortable questions about the due diligence process during bidding. It also makes banks and investors more cautious about funding other PLI-linked projects.
More critically for the EV ecosystem, every GWh of delayed domestic cell capacity directly translates into continued import dependence. Indian EV manufacturers are still largely dependent on cells from China and South Korea. The original promise of the PLI was to create a more resilient and cost-competitive local supply chain. Further setbacks only prolong that vulnerability and keep upward pressure on EV prices.
The Real Risk: Too Much Dependence on Too Few Players
Another thing that stands out is how concentrated the progress has become. Out of everything awarded so far, meaningful movement is visible mainly from Ola. The rest of the capacity is with large companies that are still in the early stages of setting up. When issues like the one with Rajesh Exports surface, it highlights how dependent the entire scheme has become on just a couple of players delivering.
This also raises a quiet but important question: Is the current structure of the PLI attracting companies that are genuinely serious about building deep manufacturing capabilities, or is it also pulling in players who see it mainly as an incentive opportunity?
What Happens Next?
The government is already thinking about giving extensions and possibly relaxing some of the stricter domestic value addition rules. The Rajesh Exports situation will likely speed up that discussion. While some flexibility makes sense, too many changes can weaken the original purpose of the scheme , which was to actually build real local capacity, not just allocate it on paper.
For the EV industry, the practical takeaway is simple: don’t expect domestic battery supply to scale up as fast as earlier projections suggested. Companies will probably have to continue relying on imports for a few more years than they had hoped.
The ACC PLI was always going to be difficult to execute. But when governance issues keep coming up with beneficiaries, it stops being just an execution challenge. It starts affecting how much trust the broader ecosystem has in these kinds of policy pushes.
And that trust is important, because without it, getting serious long-term investment into India’s battery manufacturing becomes even harder.
Sources:
- PIB updates on ACC PLI allocations and progress (March 2026)
- SEBI interim order and related reports on Rajesh Exports (June 2026)
- Economic Times & industry updates on PLI implementation challenges