The Ministry of Heavy Industries (MHI) has mandated a 100% domestic content requirement (DCR) for 18 electric vehicle (EV) components under the two-wheeler, three-wheeler, and e-buses segments to avail of subsidy under the PM E-Drive program.

MHI has amended the eligibility criteria for the phased manufacturing program (PMP) components under PM E-Drive.

PMP was launched under the Faster Adoption & Manufacturing of Electric Vehicles in India-II program to ensure original equipment manufacturers are producing EV components locally. Under the PM E-Drive program, 18 EV components are listed for mandatory local manufacturing to qualify for the subsidies.

The PM E-Drive was launched with an outlay of ₹109 billion (~$1.29 billion), focusing on providing demand incentives, deploying EVs, and developing charging infrastructure to support wider EV adoption.

Testing agencies will issue separate guidelines for assessing the domestic manufacturing of the EV components.

Importing battery modules, PMP components, and other EV components in complete knockdown form from a single supplier has also been prohibited.

In an integrated unit, PMP verification will be conducted for individual PMP components.

Separate eligibility criteria exist for electric two and three-wheelers, and e-buses.

Two and Three-wheelers

MHI has extended the mandatory DCR for multiple two-wheeler and three-wheeler EV components to May 1, 2025.

These components include a traction battery pack, battery management system, DC-DC converter, vehicle control unit, onboard charger/external portable charger, traction motor, traction motor controller including inverter, and instrument cluster.

The Ministry mandated the inclusion of the external charger cost for two and three-wheelers in the vehicle ex-factory price.

E-Buses

Compliance dates for e-buses have also been revised to six months from the amendment issue date for multiple PMP components.

PMP components included are heating, ventilation, and air conditioning system, an electric compressor for brake, a charging inlet CCS2 (a combined charging system that allows charging from AC and DC power), traction battery pack, DC-DC converter, vehicle control unit, traction motor, and instrument cluster.

The amendment also provides for domestic manufacturing of the traction motor controller, including the inverter, which requires an assembled printed circuit board integration.

Compliance dates have been extended to 12 months from the amendment date for the battery management system and the traction motor controller manufacturing. This extension also covers the inverter, which requires the assembly of electronic components/semiconductors/connectors on the printed circuit board.

In 2024, EV sales in India reached a record 1.95 million units, an over 27% growth year-over-year against the 1.53 million units sold in 2023.