NPSPL to set up ₹2,550 cr cathode material project in Andhra Pradesh

Project to localise key lithium-ion battery component, strengthen EV and electronics supply chains, and position Andhra Pradesh as a hub for advanced manufacturing

In a strategic move to strengthen India’s electronics and advanced materials ecosystem, the Andhra Pradesh (AP) government has approved a Rs 2,550 crore investment by NPSPL Speciality Chemicals Pvt Ltd to establish a cathode material manufacturing facility in Chittoor district.  

 

The project, spread across 105 acres in Gudupalle Mandal, marks a significant step towards localising one of the most critical components in the electronics and battery value chain. Cathode materials are the core functional component of lithium-ion batteries, determining battery performance, energy density, lifecycle, and safety.

 

Approved under the Andhra Pradesh Electronics Component Manufacturing Policy 4.0 (2025-30), the project is classified under the supply chain of sub-assemblies and bare components — highlighting its foundational role in the electronics ecosystem.  

 

 

Applications of cathode material

 

Li-ion batteries find use in an array of high-growth sectors such as electric vehicles (EVs) (to power cars, two-wheelers, and commercial EV fleets), consumer electronics (smartphones, laptops, wearables, and portable devices), and battery energy storage systems or BESS, and grid-scale storage for renewable energy (RE) integration.

 

Cathode materials are integral to all modern batteries, and by association all modern electronics ecosystems.

 

The project places Andhra Pradesh at the heart of two converging mega-trends, namely, the scaling up of electronics manufacturing and the global energy transition towards electrification.

 

Cathode materials account for a significant share of battery cost and technology differentiation. By building domestic capacity, India reduces dependence on imports — particularly from concentrated global supply chains — and strengthens its position in EVs, renewables, and electronics manufacturing.

 

Importance for India

 

The project is also among the first 10 cleared under the state policy, securing early-mover advantages and incentives. To accelerate execution, the state has extended a customised incentive package, including capital subsidies under the policy, 100 per cent electricity duty exemption for 10 years, power cost reimbursement, and high energy-intensive industry classification. 

 

The targeted support is aimed at making AP globally competitive in high-value manufacturing. The project is expected to generate around 400 direct jobs while catalysing a broader ecosystem spanning, battery manufacturing, EV supply chains, electronics hardware production and ancillary chemical & materials industries.  

 

More importantly, the project lays the groundwork for India’s upstream integration in battery and electronics manufacturing, an area critical for long-term technological and economic sovereignty.

 

As global supply chains realign and demand for batteries surges, cathode materials have emerged as a strategic chokepoint.

 

With this project, Andhra Pradesh is plugging India into the most critical layer of the future electronics and energy economy, a government statement said.

 

• Project approved under AP Electronics Component Manufacturing Policy 4.0
• Cathode materials are used in Li-ion batteries that are used in EVs, consumer electronics, and battery energy storage systems 
• Cathode materials are integral to modern batteries and electronics systems
• They account for a significant share of battery cost and technology differentiation