What is the Indian government’s policy on introducing electric vehicles?

“1996 GM EV1 Electric Vehicle 013 N” by Corvair Owner is licensed under CC BY-SA 2.0

Electric Vehicles (EV) as an idea appear to have finally arrived in India. As the number of EVs on Indian roads has begun to rise, the government and industry are sending numerous encouraging signals. Following declarations by Chief Minister BS Yediyurappa and Union Minister for Road Transport and Highways Nitin Gadkari, Karnataka will be home to Tesla’s manufacturing in India. Venture capitalists have revived their interest in the area, with over US $300 million being invested in businesses dealing with EVs and better battery technology this year. The number of EVs on the road has also been continuously increasing, and in 2019-20, the number of EVs on the road stood at 155,400, up around 20% year on year. Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME), which provides incentives for EV production and charging infrastructure, gave a welcome boost. 

Phase II of the project has an outlay of INR 10,000 crore that will end this year in order to increase demand for EVs. The provision of tax breaks for EV loan payments in the 2019-20 budget is another step toward the proliferation of new types of autos. In general, there is renewed public interest in having an EV in light of the country’s high gasoline prices, which make most things more expensive and contribute to total inflation. According to a recent survey, 66 percent of respondents were eager to go electric, and 53 percent were very willing to buy an EV. Despite the fact that the FAME-II project also asks to put 7000 electric buses on the road, battery technology is still not evolved enough to manage loads of passengers on buses. Companies such as Tesla have been leading the drive for EV adoption in the United States and the West with their vehicles. Because of the way the goods are developed, electric four-wheel (e4Ws) cars face various challenges in India. Range, like that of buses, tends to decrease due to the number of people and weight increase.

However, given India’s big population’s comfort with riding two-wheelers for daily commuting, it makes logical sense to concentrate manufacturing on electric two-wheelers (e2Ws). Three-wheelers, along with autorickshaws, are an important aspect of public transportation in India, but they also contribute significantly to carbon emissions in cities. According to a study conducted by The Energy and Resources Institute (TERI), IC engine autorickshaws produce 1223.89 tonnes of CO2 per day and 3.96 tonnes of nitrogen oxide per day in Bangalore. As a result, it is not surprising that many of the enterprises that have applied for the FAME-II scheme are e2Ws or e3Ws. In India, marquee two-wheeler manufacturers including Bajaj, TVS, and Hero have debuted their e2W products and are now competing with emerging businesses such as Ather, ReVolt, Okinawa, and Ampere that have a head start on the incumbents. These new goods may also be successful in Southeast Asian countries, which have a vibrant two-wheeler and three-wheeler culture and contribute significantly to the nation’s exports.