Electric vehicles (EVs) are gaining popularity across the globe as a more sustainable and eco-friendly mode of transportation. This shift is also progressing rapidly in India and the industry is witnessing a prominent rise in EV sales and adoption across cities in the country. Although this is a fairly new and growing dimension, EVreporter states that as of January 2023, electric vehicle integration stands at approximately, 5% for 2-Wheelers and with a 7% rise in EV 4-Wheelers.
While EV adoption still needs a more concrete and holistic approach, the Government Of India is extending full support to this rising sector in order to make transportation more environmentally secure. These include a variety of subsidies and incentives focused on the overall growth of the industry. What will be interesting to see now is how these initiatives will drive the growth further and if it will be able to match or even surplus the Governments aim of achieving 30% electric mobility by 2030.
Government Policies Driving EV Adoption
EV adoption is a prime concern for the Government Of India, especially with the rising pollution and high prices for traditional fuel. They recently also announced initiatives in the Union Budget which includes The National Green Hydrogen plan and an allocation of 35,000 Crores in the Energy Sector to ensure energy security and drive innovation and growth in the sector. Additionally, the government has extended concessions on Lithium Ion Batteries and introduced the Green Credit Program to support the electric vehicle industry. Despite these efforts, India’s reliance on imported components, particularly batteries, presents challenges in terms of cost, quality control, and supply chain management.
Not just this, the previously developed plans are also running in full swing which include the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme, which was launched in 2015. This scheme aimed to support the development and manufacturing of EVs, and offered incentives to manufacturers to produce EVs and to buyers to encourage them to purchase EVs.
The National Electric Mobility Mission Plan (NEMMP) and the Electric Vehicle Charging Infrastructure Guidelines are some other policies that have helped EV penetration in the country. These policies aim to create a supportive ecosystem for EVs, including incentives for charging infrastructure development and setting up charging stations across the country.
Moreover, many state governments in India have also announced their policies to promote EV adoption. For example, the Delhi government has announced a 100% exemption on road tax for EVs. Similarly, the Maharashtra government has announced a 100% exemption on road tax for EVs for a period of five years. These state-level policies have further incentivized the adoption of EVs in India.
Challenges Facing EV Adoption in India
Despite the government’s efforts to promote EV adoption, there are still challenges facing the EV industry in India. One of the primary challenges is the lack of charging infrastructure. EVs require a network of charging stations to be able to travel long distances. However, the current charging infrastructure in India is inadequate, and the government is taking steps to address this issue by incentivizing the development of charging infrastructure.
Another challenge is the high cost of EVs compared to conventional vehicles. EVs are currently more expensive to manufacture than conventional vehicles due to the high cost of batteries. However, as the technology improves and more manufacturers enter the market, the cost of EVs is expected to decrease.
The collective effort by the government and industry leaders along with strong support from buyers will play a crucial role in driving the change toward EV adoption in India.
By Pritesh Mahajan Co-Founder & CEO of Revamp Moto
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