Tata Motors, based in Mumbai, India, has shared plans to invest over $2 billion in its electric vehicle (EV) business over the next five years. The announcement was made after the Indian automaker announced that it had raised around $1 billion in funds from private equity firm TPG’s Rise Climate Fund and Abu Dhabi state holding company ADQ to expand the company’s EV business, for which it will form a separate unit.

TPG and ADQ will hold between 11 and 15% in the new EV entity, valuing it at about $9.1 billion, Tata stated. The unit will invest in new models, dedicated battery electric vehicle (BEV) platforms, charging infrastructure and battery technologies.

According to Reuters, Shailesh Chandra, Head of Tata Motors’ Passenger Vehicles business, told reporters, “The aim is to lead the EV charge in the market,” adding that to achieve its goals the company will work with investors who are focused on a “carbon-free world.”

This is thought to be the first major fundraising effort by an Indian automotive manufacturer to push clean mobility. Global automakers such as General Motors, Volkswagen and Toyota Motor are currently spending tens of billions of dollars to speed up EV adoption and counter China’s dominance of the sector.

Reuters noted that the announcement also comes just as Tesla Inc is preparing to launch its cars in India, and has been lobbying the Indian government to lower import duties on EVs. India intends for EVs to make up 30% of total car sales by 2030, a dramatic leap from less than 1% at present. The government has launched a number of incentive schemes to achieve this goal, including one for setting up local battery manufacturing.

In developing its EV business, Tata will have the support of other group companies such as Tata Power, Tata Chemicals and Tata Autocomp, enabling it to rapidly create an ecosystem for EVs, according to Chandra.

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