NEW DELHI: India’s electric vehicle (EV) battery, energy storage services, and stainless-steel sectors are bracing for higher nickel prices and supply uncertainty of nickel derivatives in the wake of the West Asia war, according to four people aware of the matter.
This is because plants that refine the silvery-white metal in Indonesia face phosphorus and sulphur supply shortages from West Asia due to the war and the blockade of the Strait of Hormuz, the people said.
Nickel holds the key to India’s energy transition and its clean energy technologies. The country imports about 80% of its ferronickel (an alloy of nickel and iron) requirements from Indonesia. Ferronickel and nickel pig iron (NPI), both alloys of iron and nickel, are the primary raw material for making stainless steel. Nickel accounts for about 22% of the cost of an electric vehicle battery.
Debmalya Sen, president of the India Energy Storage Alliance, an industry lobby group for battery makers, said NMC batteries are used in some high-end and premium electric vehicles, and they could be impacted by rising nickel prices. However, he noted that there is a transition towards lithium-iron-phosphate batteries from NMC battery chemistry in some companies.
At present, though, the bigger concern is not an immediate physical shortage but rising costs, delays and supply uncertainty. BMW India said it had to offset escalating logistics and material costs alongside a depreciating rupee.
“We have had to implement price adjustments of up to 2% in January and in April,” Hardeep Singh Brar, president and chief executive officer (CEO) of BMW India, said in an emailed response. “Given the current situation, we may need to take some further price increases during the remaining part of the year.”
Commodities experts said India largely imports processed nickel products from Indonesia including nickel matte, mixed hydroxide precipitate (MHP), ferronickel and stainless-steel-linked nickel intermediates.
Critical inputs
“These are critical inputs for India’s stainless-steel industry and increasingly for the EV (electric vehicles) battery ecosystem,” said Nidhi Srivastava, head of research and strategy at New Delhi-based think tank Dravya, run by the Indian Institute of Human Settlement (IIHS) Centre for Materials and Sustainable Development.
West Asia tensions are affecting shipping routes, freight costs and the availability of certain processing inputs such as sulphur and phosphates used in nickel refining, she said.
“Since India is highly import-dependent for both processed nickel and several refining inputs, battery manufacturers and stainless-steel producers may face higher procurement costs and planning uncertainty if disruptions continue,” Srivastava said.
According to commerce and industry ministry data, 80% of India’s $304.69 million ferronickel imports in FY26 came from Indonesia. Nickel prices in India climbed 7.2% to ₹1,71,540 per quintal in April from ₹1,59,890 per quintal in February, before the West Asia war began, according to data from the Centre for Monitoring Indian Economy (CMIE). Global nickel prices rose to $1,796 per quintal in April from $1,717.30 in February, the CMIE data showed.
“Rising sulphur and sulphuric acid costs are increasing HPAL (High Pressure Acid Leaching) processing costs for MHP production as Indonesia relies heavily on imported sulphur from West Asia,” said Jayprakash Sahu, general manager of the recycling, non-ferrous and stainless-steel division at BigMint, a commodities data intelligence service. “This may tighten margins for battery-grade nickel intermediates despite the broader nickel market remaining oversupplied.”
Large companies appear to be better positioned to face disruption in the sector, though they may be the exception. Jindal Stainless Ltd, India’s largest stainless-steel maker, said it has not faced nickel-related supply issues and that its hedging strategy to source the metal had shielded it from price swings.
Supply chain flexibility
“We secure our nickel supply through a multi-sourcing strategy (through NPI, scrap and slabs), which provides us with supply chain flexibility and financial stability to counter fluctuating nickel prices globally. Our investments in Indonesia further support our raw material security,” said Tarun Khulbe, CEO, CFO and whole-time director of Jindal Stainless.
Khulbe said there have been issues with the supply of sulphur, which was largely supplied from countries in West Asia, but the situation is improving now.
“However, Indonesia has recently revised the pricing formula of nickel ore and has strict compliance on the nickel ore quotas, which has led to price increases across all nickel alloys. The war has only made the Indonesian government tighten its overall control over the commodity market,” he said.
A February 2026 report by Federation of Indian Chambers of Commerce and Industry (Ficci) and Deloitte said nickel is crucial to the global energy transition, with global nickel demand set to rise to 5.5 million tonnes (mt) by 2040 from 3.4 mt in 2024. Clean energy technologies are likely to contribute to 42% of this demand as nations implement emission-reduction policies.
According to Srivastava of IIHS, diversification is key to maintaining India’s materials security.
“India needs a broader material security strategy rather than focusing only on mining. This includes diversifying sourcing beyond a few geographies, building strategic partnerships with countries such as Australia, Japan and Norway, strengthening domestic recycling capacity, and investing in refining and processing ecosystems within India,” she said, adding that improving the circular economy to recover scrap material is also important.
Queries emailed to the spokespersons of the Indonesian embassy in New Delhi, luxury EV maker Mercedes-Benz India, battery makers Amara Raja, Exide and Ola Electric and steel maker JSW Group on 27 May remained unanswered.
Agratas, the Tata Group’s battery manufacturing arm, which is setting up a battery-making unit in India, declined to comment.