New Delhi, Dec 11 (IANS): There is a potential $40 billion investment opportunity for the development of electric vehicles (EVs) and ancillary industries in India over the next 5-6 years, a report showed on Wednesday.

About two-thirds of the planned investments can potentially materialise in the lithium-ion battery segment alone, said the report by Colliers, a professional services and investment management company.

The deployment of these funds will rely upon successful implementation of government policies, charging infrastructure ramp-up and domestic manufacturing capacity scale-up, it added.

At the same time, with an uptick in EV adoption, increasing need for charging infrastructure would potentially translate into real estate demand for more than 45 million square feet by 2030.

The investment commitments in the domestic EV industry rose over 3 times times in the last three years.

With an overall EV penetration rate of 8 per cent in India, Colliers estimates sales of around 2 million EVs in 2024.

“While demand and supply incentives will continue to play a pivotal role in faster adoption of EVs, a multifold increase in EV sales can be fast-tracked by the reduction in production costs and improving affordability with respect to EV price points,” said Badal Yagnik, Chief Executive Officer, Colliers India.

Additionally, high-capacity original equipment manufacturing units and large-scale production of lithium-ion battery variants must be high on the EV priority list, Yagnik added.

With the rise in domestic production of EVs, about 13,000 acres of land acquisition and development plans can potentially materialize by 2030.

Of the potential land development opportunities, more than 80 per cent is likely to come from lithium-ion battery manufacturers.

It is imperative to focus on lithium-ion battery and ancillary segments and public private partnerships in augmentation of charging infrastructure on highways, expressways and urban agglomerations across the country, the report noted.