India’s growing demand for batteries is rapidly outpacing growth in cell production in the country. In 2025, India's government waived import duties on goods and machinery to make lithium ion batteries for EVs and phones. Initially, this was due to expire 31 March 2026, but was later extended to 31 March 2028. This built on India's previous moves to reduce reliance on imported cells. In 2020, it introduced the Production Linked Incentive (PLI) scheme. Despite this, India’s battery sector continues to be impacted by project delays.

Plans to halt approvals for new Chinese cell capacity for 2026 have been confirmed and expanded to include production of cells for EV applications as well as for battery energy stationary storage (BESS) as part of a review of total battery capacity, expected to be completed by year end. 

China is reported to have temporarily paused approvals for new battery energy stationary storage (BESS) cell production projects. The pause is part of increased measures by China to curb overcapacity and oversupply in the BESS cell market and is likely part of a review of existing and planned projects, but only applies to facilities that are yet to begin construction. This follows on from MOFCOM’s cessation of the lithium ion battery industry’s eleven year tax exemption and the elimination of export tax rebates for battery products. Those tax policies served more to encourage producers to limit output, rather than pause business activities. “If implemented, this new legislation would represent a significant escalation in China’s attempts to control the surge in BESS cell production witnessed across 2025 and 2026,” said Evan Hartley, research manager at Benchmark.