In a recent meeting held by NITI Aayog, two-wheeler industry stakeholders, and the Society of Indian Automobile Manufacturers (SIAM), the government think tank has asked the traditional two-wheeler players to come up with an electric vehicle adoption plan within the next two weeks.

A recent air pollution index states that seven of the ten most polluted cities in the world are in India.

To combat oil import costs and pollution, NITI Aayog has come up with a comprehensive road map for clean mobility stating that all three wheelers and two wheelers sold after 2023 and 2025 respectively need to be battery operated. The two-wheelers are in the low-speed category up to 150 cc. They have also proposed gigawatt scale domestic battery production to make the vehicles cost competitive.

The traditional two-wheeler players such as Hero MotoCorp, Bajaj Auto, and TVS Motor who chaired the meeting stated that a complete transition within the given timeframe is too early for EV rollouts. A more phased out, year by year timeline which defines shared objectives, build infrastructure and supply chain is more plausible. The stakeholders have also suggested hybrid technology as a preemptive measure before transitioning to EVs.

Mercom spoke to the director of Society of Manufacturers of Electric Vehicles (SMEV), who said, “Measures are being taken to make EVs cost competitive and at par with internal combustion engine (ICE) vehicles. Road tax on ICE vehicles ranges from 8% to 10% depending on the state. The government is coming up with non-fiscal subsidies like registration fee exemption and road tax changes for electric vehicles. States like Delhi, Maharashtra, Karnataka are also coming up with incentives in their state-wise EV policies. Fiscal subsidies are provided by the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME II India) policy which shoulders 20% of the total cost.”

“Subsidy policies are being provided to carmakers and cab aggregators to promote the EV transition further. However, the EV transition must begin with two-wheelers as around 21 million two-wheelers were sold in India in 2018, and they occupy a significant share in the automobile market. States in India are focusing heavily on skill development to generate manpower specifically for developing the EV supply chain. FAME is supporting the nodal agencies in this regard. After sales are minimal for EVs,” said the SMEV director.

“Charging station infrastructure is the primary focus. Because of low returns on investment, the establishment of charging stations cannot be privatized. Charging stations are scheduled to be established every 3 km in cities and every 50 km on highways. ₹10 billion (~$143.98 million) has been allocated for charging infrastructure by the government. A suggestion has been made to companies to allocate their CSR budget for charging infrastructure. Currently, Taiwan and China have many low-speed two-wheelers. India remains the world’s largest two-wheeler market, and 80% of the Indian auto market comprises two and three wheelers.” the source stated.

NITI Aayog is taking an aggressive stance in pushing for electrification in the mobility market. They reason that if the mainstream automakers don’t adopt EVs soon, India may lose out on the electric mobility revolution just like the electronics and semiconductor revolution. Stakeholders have claimed that the industry needs time to stabilize since updating to the new Bharath Stage-VI (BS-VI) norms will take up a lot of planning and investment.

Startups like Ather Energy, Revolt Intellicorp, SmartE, and Kinetic Green are ready for the EV adoption from 2023 if the government advances the timeline. However, the stakeholders claim that due to cost consciousness, performance, range, and infrastructure, promoting EVs amongst customers remains a challenge.

NITI Aayog had put forth a proposal for EV adoption by 2030 in the country. India relies heavily on oil imports to meet transport needs, and this move will also reduce the oil import burden on the country.

Previously, NITI Aayog also led a summit to create awareness about the numerous facets of mobility. The summit brought together stakeholders that are enhancing mobility across different domains. The government think tank released a report at the summit called Zero Emission Vehicles: Towards a Policy Framework.

Image credit: Ather Energy