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India's top carmaker sees hydrogen as 'interesting alternative'

02 August 2021 - 17:58 By Reuters
A file image of the Suzuki logo.
A file image of the Suzuki logo.
Image: Robert Hradil/Getty Images

The use of hydrogen power for mobility is an “interesting alternative” for India, especially as it would reduce dependence on lithium imports, the chair of Maruti Suzuki, India's top-selling carmaker, said on Monday.

Demand for lithium for batteries is soaring as governments across the world push car makers to meet stringent targets for cutting carbon emissions, partly by phasing out internal combustion engines.

In India, however, the adoption of electric vehicles (EVs) by carmakers has been slow due to the high cost of batteries, as well as insufficient charging infrastructure. India also does not have lithium reserves, the majority of which are controlled by China globally.

This makes EVs a hard sell in a country like India where per capita income is around $2,000 (roughly R28,785), or about 5% of that in Europe and Japan, and 95% of cars sold are priced below $20,000 (roughly R287,856), Maruti chair RC Bhargava told shareholders in the company's annual report.

“We need to recognise that our strategy for moving towards net zero emission has to be consistent with the economic and infrastructure conditions prevailing in the country,” Bhargava said.

To reduce fuel consumption and emissions, Maruti is pushing sales of cars that operate on compressed natural gas (CNG), and is also investing in hybrid technology, he said, adding that “the use of hydrogen is also an interesting alternative”.

Suzuki Motor Corp, which controls Maruti, is also prioritising development of clean technologies suitable for the Indian market, Bhargava said, adding that Suzuki's alliance with Toyota Motor Corp in Japan would prove valuable for this effort.

Bhargava's comments come as debate around EVs is gathering steam in India, with Tesla Inc lobbying the government to lower import duties on electric cars.

Tesla's demands have polarised India's  car industry, with South Korea's Hyundai Motor Co — which has a share of about 18% of the country's car market and is Maruti's closest competitor — supporting a tax cut on imports.

Maruti's comments in support of hydrogen also come weeks after Mukesh Ambani, chair of refiner Reliance Industries, said it would invest $10bn (roughly R143,928,100,000) in clean energy, including setting up giga factories to produce fuel cells and green hydrogen.