India’s electric vehicle (EV) policies announced by the Union government and state governments saw established EV players accelerate manufacturing even as several startups entered the market in 2021.
As of November 25, 2021, over 165,000 electric vehicles (EVs) have been supported through demand incentives of ₹5.64 billion (~$75.36 million) under the second phase of the Faster Adoption and Manufacturing of Electric Vehicles (FAME)-II program.
In September, the Union Government notified the Production Linked Incentive (PLI) program for automobile and auto components. It is estimated that the PLI program will lead to investments of over ₹425 billion (~$5.72 billion) in five years and incremental production of over ₹2.3 trillion (~$31 billion). The program is expected to create over 750,000 jobs.
Most state-specific EV policies have been drawn up for five years, with many of them deciding to allot subsidies for EVs based on the size of their battery packs.
Assam aims for 25% EV penetration in all vehicle registrations through its EV policy by 2026. The state will target and support the deployment of the first 200,000 EVs – 100,000 electric two-wheelers (E2Ws); 75,000 electric three-wheelers (E3Ws); and 25,000 electric four-wheelers (E4Ws)- either for individual or commercial use.
Odisha aims to achieve 20% of all vehicle registrations to be EVs by 2025. The state would provide a 15% subsidy for the purchase of E2W, E3W, and E4W up to a maximum of ₹5,000 (~$68), ₹12,000 (~$163), and ₹100,000 (~$1,359) respectively. E-buses will receive a subsidy of 10% up to a maximum of ₹2,000,000 (~$27,176). A purchase incentive of ₹30,000 (~$408) will be provided to the first 5,000 electric goods carriers registered in the state.
Rajasthan is focused on ramping up sales of E2W and E3W. According to the state’s transport department, the government will reimburse State Goods and Services Tax (SGST) on the sale of EVs in Rajasthan. The SGST reimbursement would be based on the SGST amount mentioned in the bill of sale. The policy also offers subsidies to E2W and E3W based on their battery capacity.
In Goa, incentives are only available for E2W with advanced batteries and are subject to a maximum incentive of ₹30,000 (~$402)/vehicle. A purchase incentive of ₹10,000 (~$134)/kWh of battery capacity would be provided for each vehicle to the registered owner (subject to a maximum incentive of ₹30,000 (~$402) per vehicle). Registered owners of two-wheelers with internal combustion engines (ICE) are eligible for a ‘scrapping incentive’ for scrapping and de-registering their old ICE two-wheelers registered in Goa. An incentive of up to ₹5,000 (~$67) would be reimbursed by the state’s Department of New and Renewable Energy to the registered owner of two-wheelers.
Maharashtra plans to achieve the target of 10% E2Ws, 20% E3Ws, and 5% E4Ws out of total vehicle registrations by 2025. The policy aims to achieve at least 25% of the urban fleet operated by fleet aggregators or operators in the state to transition to EVs by 2025.
The Gujarat EV Policy offers a subsidy of ₹20,000 (~$270) for E2W that cost up to ₹150,000 (~$2,018); ₹50,000 (~$673) subsidy for E3W that cost up to ₹500,000 (~$6,731), and ₹150,000 (~$2,018) subsidy for electric cars that cost up ₹1.5 million (~$20,193).
West Bengal aims to position the state as a sustainable transportation infrastructure hub with its EV policy. The state plans to have one million EVs combined across all segments during the five-year implementation period. The tariff for EV charging will be around ₹6 (~$0.082)/kWh to keep the public charging station charges attractive for EV owners and end-users. Under the new policy, Kolkata, Asansol, Darjeeling, and Howrah will be declared as model electric mobility cities with goals to adopt EVs.
Meghalaya hopes to see EV representing 15% of the state’s overall vehicle mix by 2025. Meghalaya will offer a purchase subsidy of ₹10,000 (~$137)/kWh for the first 3,500 E2W priced below ₹150,000 (~$2,056) purchased and registered in the state during the policy period. The first 200 electric three-wheelers priced below ₹500,000 (~$6,852) will get a purchase subsidy of ₹4,000 (~$55)/kWh. The first 2,500 electric cars priced below ₹1.5 million (~$20,556) will get a purchase subsidy of ₹4,000 (~$55)/kWh.
In February, Road Transport and Highways Minister Nitin Gadkari launched the Go Electric campaign to encourage the adoption of electric mobility vehicles to ensure energy security in the country. Gadkari expressed concern about the massive cost of importing fossil fuels and said CO2 emissions from vehicles are a significant challenge. The country must encourage vehicles that run on alternative fuels such as electric batteries.
In June, the government issued a notification for the PLI incentives under the ‘National program on Advanced Chemical Cell (ACC) battery storage’ to implement ACC manufacturing facilities for EVs.
The Department of Heavy Industries announced amendments to the FAME-II program. A specific demand incentive for E2W of ₹15,000 (~$205)/kWh was announced. Earlier, there was a uniform demand incentive of ₹10000 ($137)/KWh for all vehicles. Also, the cap on incentive for E2W was raised to 40% of the total cost of the vehicles. The cap earlier was 20% for all vehicles, including E2W.
The Ministry of Heavy Industries (MHI) has approved 2,877 EV charging stations totaling ₹5 billion (~$66.80 million) across 68 cities in 25 states and union territories. MHI also approved 1,576 charging stations amounting to ₹1.08 billion (~$14.43 million) across nine expressways and 16 highways under the FAME-II program.
Image credit: Visitor7, CC BY-SA 3.0, via Wikimedia Commons
Arjun Joshi is a staff reporter at Mercom India. Before joining Mercom, he worked as a technical writer for enterprise resource software companies based in India and abroad. He holds a bachelor’s degree in Journalism, Psychology, and Optional English from Garden City University, Bangalore. More articles from Arjun Joshi.