The Sajjan Jindal-led JSW Group is set to relocate its proposed Rs 40,000 crore electric vehicle (EV) and battery manufacturing project from Odisha to Maharashtra, seven months after signing an agreement with the Odisha government. The decision comes amid a change in the political environment in Odisha, with JSW now exploring potential sites in Aurangabad and Nagpur for the relocated project. This move reflects the intensifying competition among Indian states to attract large-scale investments in emerging industries like electric vehicles and semiconductors.
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JSW’s project was initially planned for Odisha but is likely to move to Maharashtra due to political changes.
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The project involves a 50 GWh battery plant, lithium refinery, copper smelter, and EV component manufacturing.
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Maharashtra, specifically Aurangabad and Nagpur, is being considered as the new location for this Rs 40,000 crore investment.
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Odisha government is still in talks with JSW, but the relocation seems imminent.
Project Details: Initial Agreement with Odisha
In February 2024, the JSW Group had signed a memorandum of understanding (MoU) with the Biju Janata Dal (BJD)-led Odisha government to set up an integrated EV and battery manufacturing project. The project was slated to be developed across two key locations in Odisha:
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Naraj, Cuttack: Proposed to house an EV and component manufacturing plant.
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Paradip, Jagatsinghpur: Planned for a copper smelter and a lithium refinery, essential for EV battery production.
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50 GWh EV Battery Plant: This facility was planned to manufacture EV batteries at scale.
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Electric Vehicle Manufacturing: A dedicated unit for the production of electric vehicles and components.
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Lithium Refinery and Copper Smelter: Facilities essential for sourcing key raw materials for batteries and EV components.
The MoU was signed shortly after the Odisha state cabinet approved a special incentive package to support the project. This package was designed to attract investment into Odisha’s EV manufacturing sector, which was seen as a crucial part of the state's industrial growth strategy.
Why Maharashtra?
Despite the initial agreement, JSW Group is now reconsidering its commitment to Odisha, citing the recent change in political leadership as a primary reason. Maharashtra, with its robust infrastructure and industrial ecosystem, has emerged as an attractive alternative for JSW's project. The group is currently evaluating the cities of Aurangabad and Nagpur for setting up the proposed facilities.
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Change in political leadership: A change in Odisha's political landscape is believed to have influenced JSW's reconsideration of its project location.
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Competitive state incentives: States like Gujarat and Maharashtra have been aggressively offering incentives to attract big-ticket investments in sectors like semiconductors and electric vehicles, which has led to increased competition.
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Delay in project execution: Odisha's delay in finalizing key aspects of the project is another possible reason for the shift.
Maharashtra's Gain, Odisha's Loss
The relocation of JSW's project is a significant setback for Odisha, as it loses a landmark investment that would have spurred local economic growth, job creation, and infrastructure development. For Maharashtra, on the other hand, this is a significant win as it strengthens its position as a leader in India's EV manufacturing sector.
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Odisha's Potential Miss: With the JSW Group pulling out, Odisha stands to lose not just the investment but also the ancillary industries that the project would have attracted.
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Maharashtra's Growing Lead: By securing JSW’s project, Maharashtra reinforces its commitment to becoming a hub for EV and battery manufacturing, adding to its portfolio of industrial investments.
Odisha Government's Response
Odisha's Industries Minister, Sampad Chandra Swain, has downplayed reports of JSW's relocation, stating that discussions with the group are ongoing. According to Swain, while there has been no official confirmation of the shift, delays in project execution are not uncommon. He emphasized that negotiations are still in progress, and a final decision is yet to be made.
Although JSW has initiated discussions with Maharashtra, Odisha remains hopeful that the project could still be salvaged. However, the increasing momentum behind the relocation suggests that the project may indeed move westward.
“We are in talks with the JSW. Everything will be clear once the discussion reaches a conclusion. They have not finalized to shift the project from Odisha and we are also not informed about it. There is inordinate delay in starting projects on several occasions and it is the same with the JSW,” Swain said.
As the JSW Group finalizes its decision to relocate its Rs 40,000 crore electric vehicle and battery project to Maharashtra, the outcome will have far-reaching implications for both states. Maharashtra is poised to benefit from a major boost to its EV ecosystem, while Odisha faces the challenge of recovering from the loss of such a significant investment. The ongoing discussions between JSW and both state governments will determine the final outcome of this industrial shift.
With inputs from agencies
Image Source: Multiple agencies
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