Indian Oil Corporation Limited (IOCL), a state-run organization, has announced a joint venture with Japan’s Panasonic Energy. This joint venture aims to manufacture cylindrical lithium-ion cells in India.

The binding term sheet has been signed by the companies. The term sheet will facilitate in drawing of a framework for the joint venture after a signing of a head agreement on January 21.

Both the companies are currently conducting feasibility study on using battery technology. This will facilitate India’s transition to clean energy. The details of the collaboration will be finalised in the coming months.

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Lithium-ion cells manufacturing is gaining importance in India due to increasing demand from electric vehicles and Battery Energy Storage Systems (BESS)

According to IOCL, this venture will help in meeting the increased demands and, accordingly, the investments in setting up local manufacturing units will set up a complete supply chain ecosystem improving India’s self-reliance, fortifying India’s position in the global energy landscape. In addition, according to IOCL, this venture will also increase the demand for raw materials sourcing within the country which will enhance domestic value addition .

The IOCL has been looking for ways to diversify the operations to help in its aim of achieving net zero carbon emissions from operations by 2046. This is the reason why IOCL has been involved in developing clean energy sources.