Electric Vehicle Industry in India: Why Foreign Investors Should Pay Attention
The electric vehicle industry in India is picking pace with 100% FDI possible, new manufacturing hubs, and increased push to improving charging infrastructure. Federal subsidies and policy favoring deeper discounts for Indian-made electric two-wheelers as well as a boost for localized ACC battery storage production are other growth drivers for the Indian EV industry. Moreover, in September 2021, a production-linked incentive scheme for the automotive sector was approved by Cabinet to boost the manufacturing of electric vehicles and hydrogen fuel cell vehicles. India reported sales of over 300,000 EV units in 2021.
The global automotive industry is undergoing a paradigm shift at present in trying to switch to alternative/less energy intensive options. India, too, is investing in this electric mobility shift.
The burden of oil imports, rising pollution, and as well as international commitments to combat global climate change are among key factors motivating India’s recent policies to speed up the transition to e-mobility.
Electric vehicle industry in India: Growth targets
The Indian automotive industry is the fifth largest in the world and is slated to be the third largest by 2030. Catering to a vast domestic market, reliance on the conventional modes of fuel intensive mobility will not be sustainable. In an effort to address this, federal policymakers are developing a mobility option that is “Shared, Connected, and Electric” and have projected an ambitious target of achieving 100 percent electrification by 2030.
By making the shift towards electric vehicles (EVs), India stands to benefit on many fronts: it has a relative abundance of renewable energy resources and availability of skilled manpower in the technology and manufacturing sectors.
According to an independent study by CEEW Centre for Energy Finance (CEEW-CEF), the EV market in India will be a US$206 billion opportunity by 2030 if India maintains steady progress to meet its ambitious 2030 target. This would require a cumulative investment of over US$180 billion in vehicle production and charging infrastructure.
Another report by India Energy Storage Alliance (IESA) projects that the Indian EV market will grow at a CAGR of 36 percent till 2026. The EV battery market is also projected to grow at a CAGR of 30 percent during the same period.
Launch of ‘e-AMRIT’ portal: One-stop platform for information on electric vehicles
India rolled out the website e-AMRIT – https://www.e-amrit.niti.gov.in/ – at the COP26 Summit in Glasgow, which will function as a one-stop destination for all information on electric vehicles. It addresses key concerns about the adoption of EVs and their purchase – such as charging facility locations and EV financing options as well as information about investment opportunities, government policies, and available subsidies for drivers and manufacturers.
Existing EV ecosystem in India and investment outlook
Regardless of the country’s ambitious targets, India’s EV space is at a nascent stage. However, looking at it differently – India offers the world’s largest untapped market, especially in the two-wheeler segment. 100 percent foreign direct investment is allowed in this sector under the automatic route.
The federal government is also prioritizing the shift towards clean mobility, and recent moves to amend the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME) II scheme to make electric two-wheelers more affordable, is a case in point. Under the phase two of the FAME scheme, about 1,65,000 electric vehicles have been supported, as on November 25, 2021, by way of demand incentive amounting to about INR 5.64 billion (US$75.16 million). Further, under the scheme, approvals have been granted for 6,315 electrical buses, 2,877 EV charging stations amounting to INR 5 billion (US$66.63 million) in 68 cities across 25 states/Union Territories and 1,576 charging stations amounting to INR 1.08 billion (US$14.39 million) across nine expressways and 16 highways.
In addition, multiple production-linked incentive schemes intend to create a local manufacturing ecosystem to support goals around greater adoption of electric mobility transport. This is sought to be achieved by incentivizing fresh investments into developing indigenous supply chains for key technologies, products, and auto components.
Production-linked incentive schemes
In May 2021, the government rolled out a Production-Linked Incentive Scheme (PLI) for ACC Battery Storage Manufacturing, which will incentivize the domestic production of such batteries and reduce the dependence on imports. This will support the EV industry with the requisite infrastructure and will significantly cause a reduction in cost of EVs.
On September 15, 2021, the government approved a PLI Scheme for the automobile and drone industry, which intends to incentivize high value advanced automotive technology vehicles and products, including ‘green automotive manufacturing’ (see Cabinet press release here).
The PLI Scheme for the auto sector is open to existing automotive companies as well as new investors who are currently not in the automobile or auto component manufacturing business. The scheme has two components:
i) Champion OEM Incentive Scheme: This is a ‘sales value linked’ scheme, applicable on battery electric vehicles, and hydrogen fuel cell vehicles of all segments.
ii) Component Champion Incentive Scheme: This is a ‘sales value linked’ scheme, applicable on advanced automotive technology components of vehicles, completely knocked down (CKD)/ semi knocked down (SKD) kits, vehicle aggregates of 2-wheelers, 3-wheelers, passenger vehicles, commercial vehicles, and tractors etc.
Emerging market players
Many leading battery producers like Amara Raja Batteries, have picked up the cue from theses incentives to orient new investments into green technologies, including in lithium-ion batteries.
In April 2022, one of the world’s most energy dense batteries at 54MWh, developed by a Bengaluru-based battery startup – Pravaig, was acquired by a European renewable energy company, Eren Groupe, for its storage applications. Having a high density implies that the battery gives more power per atom, proving to be cost-effective when compared with alternatives such as sodium-ion or aluminum air. The developers of the battery have also informed that it takes just 30 minutes to fully charge a battery. This new acquisition by a European company will not only give boost to domestic manufacturing, but will also make pave way for making EVs more economical, considering batteries usually account for 35-40 percent of the total cost.
Further responding to the opportunity that India’s EV industry presents, many leading industry players like OLA Electric Mobility Pvt, Ather Energy, and Mahindra Electrics are rapidly growing their market presence. Moreover, certain states like Karnataka and Tamil Nadu are rolling out innovative and timely investor-friendly policies besides building necessary infrastructure.
Recently, the American electric vehicle and clean energy company Tesla Inc. marked its entry into India by incorporating its subsidiary, Tesla India Motors and Energy Pvt Ltd, in Bengaluru.
In February 2021, Ather Energy, India’s first intelligence EV manufacturer moved its US$86.5 million factory from Bengaluru (Karnataka) to Hosur (Tamil Nadu). Ather Energy’s factory is said to have an annual production capacity of 0.11 million two-wheelers.
In March 2021, Ola Electric, the subsidiary of the unicorn Indian ride-hailing start-up, also announced that it would be setting up the world’s largest electric scooter plant in Hosur (which is a two and a half-hour drive from Bengaluru) over the next 12 weeks, at a cost of US$330 million, and aiming to produce 2 million units a year. By 2022, Ola Electric wants to scale up production to pump out 10 million vehicles annually or 15 percent of the world’s e-scooters.
Meanwhile, indicative of the market interest for electric two-wheelers in India, Ola Electric reportedly clocked INR 11 billion (US$149.26 million) in sales over a two-day purchase window. Ola Electric’s website allows scooters to be reserved and the next sales window opens November 1. The electric scooters are manufactured at the Ola Futurefactory near Krishnagiri in Tamil Nadu.
On September 9, 2021, Greaves Cotton announced its entry into the multi-brand electric vehicle retail segment under the brand name AutoEVMart. According to reports, this platform will present consumers with a wide range of electric vehicles to choose from – from Ampere Electric to other brands in the EV space. Thus, AutoEVMart will serve as a marketplace for electric vehicles in India, offering e-two-wheelers and e-three-wheelers, among others, along with EV accessories. Greaves Cotton envisions first-of-its-kind multi-brand retail stores for clean tech or electric mobility in Bengaluru.
Recently, Sterling and Wilson Pvt Ltd (SWPL), India’s leading engineering, procurement, and construction company announced its entry into the electric mobility segment in India. It has signed a 50-50 joint venture with Enel X, to be incorporated on April 1, 2021, to launch and create innovative charging infrastructure in India.
There have also been positive developments in the expansion of charging infrastructure across the country – states like Andhra Pradesh, Uttar Pradesh, Bihar, and Telangana are setting impressive targets for the deployment of public charging infrastructure to increase uptake of electric vehicles in the country.
The key reasons why these states are doing better than others are local fiscal sops, better logistics, an investor-friendly government policy, business facilitation through easier access to authorities, supply chain connectivity, and the availability of suitable land.
Karnataka was the first state to introduce a comprehensive EV policy and has emerged as a hotspot for EV businesses in India, both in EV and EV ancillary manufacturing as well as R&D segments. Tamil Nadu is also leaping forward at a commendable pace, owing to its supply ecosystem, larger land parcel, proximity to ports, and proactive investor support through administrative portals like Guidance Tamil Nadu.
Nevertheless, while growth in the EV industry is on an upward tick, it has much ground to cover to be able to realize the government’s ambitious 2030 target. The COVID-19 pandemic not only slowed the industry’s progress, but also dampened overall market demand.
Still, market sentiment has retained positivity in some segments. In FY 2020, EV sales for two-wheelers in India increased by 21 percent. For EV buses, the sales for the same period increased by 50 percent. In contrast, the market for electric cars remained grim, registering a five percent decline. As for total EV sales, after suffering an initial setback in 2020, sales appear to be slowly picking up. In January 2021, 15,910 units of EVs were sold in India, and out of these, the maximum units were sold in Uttar Pradesh, followed by Bihar and Delhi.
Developing India’s EV market: Growth projections and government policy
In April 2019, Niti Aayog, the federal think tank, published a report titled “India’s Electric Mobility Transformation”, which pegs EV sales penetration in India at 70 percent for commercial cars, 30 percent for private cars, 40 percent for buses, and 80 percent for two- and three- wheelers by 2030. These targets, if achieved, could lead to a net reduction of 14 exajoules of energy and 846 million tons of CO2 emissions over the deployed vehicles’ lifetime. Electric vehicles sold until 2030 can cumulatively save 474 million tons of oil equivalent over their lifetime, worth US$207.33 billion.
This will help India fulfil its global commitments to lower carbon emissions and increase use of cleaner sources of energy and transportation as required by the Nationally Determined Contributions (NDCs) under the United Nations Framework Convention on Climate Change (UNFCCC) and EV30@30.
Several fiscal and non-fiscal measures have been put in place to facilitate the adoption of electric mobility. They are as follows:
- National Electric Mobility Mission Plan 2020 (NEMMP): It was launched in 2013 by the Department of Heavy Industry (DHI) as a roadmap for the faster manufacture and adoption of EVs in India.
- FAME Phase I: As part of the NEMMP 2020, the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME India) Scheme was notified in April 2015, to promote the manufacture of electric and hybrid vehicle technology. It has mainly focused on four aspects – demand creation, technology platform, pilot projects, and charging infrastructure. For demand creation, incentives have mainly been disbursed in the form of reduced purchase prices.
- FAME Phase II: Launched in 2019 for a period of three years, this scheme has an outlay of US$1.36 billion to be used for upfront incentives on the purchase of EVs as well as supporting the development of charging infrastructure. FICCI has asked for continuation of FAME II till 2025, along with short-term booster incentives to enhance demand. This second phase focuses on supporting electrification of public and shared transportation and aims to support, through subsidies, about 7,000 e-buses, 5,00,000 e-three wheelers, 55,000 e-four wheeler passenger cars and one million e-two wheelers. In addition, creation of charging infrastructure is also supported.
- Amendments to FAME Phase II: On June 11, 2021, the Ministry of Heavy Industry announced further amendments to the FAME II scheme to give a boost to EV demand among consumers. Under the revised policy, the subsidy per electric two-wheeler (Indian-made), which is linked to the battery size, has been increased to INR 15,000 (US$204.60) per Kilowatt-hour (KWh) from INR 10,000 (US$136.40) KWh. Furthermore, electric two-wheeler manufacturers can now give discounts of up to 40 percent to consumers, which is a significant raise from the previous cap of 20 percent. The eligibility criteria for these electric two-wheelers to qualify for subsidy under the FAME II scheme include a minimum range of 80 km on single charge and a minimum top speed of 40 km per hour. These incentives are expected to significantly lower the purchase price and lift buyer sentiment, creating a spur in market demand. The amendments in the policy have been hailed by industry stakeholders who are now expecting the EV two-wheeler industry to clock sales of over six million units by 2025. Yet, according to a recent CRISIL report, 95 percent of the e-scooters in India are not eligible for the FAME II incentive scheme, as they fail to meet the eligibility criteria.
- Ministry of Power: It has clarified that charging EVs is considered a service, which means that operating EV charging stations will not require a license. It has also issued a policy on charging infrastructure to enable faster adoption of EVs. The revised consolidated Guidelines & Standards for Charging Infrastructure for Electric Vehicles was promulgated on January 14, 2022. Exhaustive in scope, these guidelines include provisions for a) individual owners of EVs and b) for public charging stations (PCS) infrastructure. It covers land use and access, power tariffs, state and central government roles, timelines for providing connectivity for installation of PCS, among other concerns.
- Ministry of Road Transport and Highways: It has announced that both commercial as well as private battery-operated vehicles will be issued green license plates. It has also notified that all battery operated, ethanol-powered, and methanol-powered transport vehicles will be exempted from the commercial permit requirement.
- Department of Science and Technology: It has launched a grand challenge for developing the Indian Standards for Electric Vehicle Charging Infrastructure.
- Niti Aayog: The National Mission on Transformative Mobility and Battery Storage has been approved by the cabinet, and the inter-ministerial steering committee of the Mission will be chaired by the CEO of Niti Aayog. The Mission aims to create a Phased Manufacturing Program (PMP) for five years till 2024, to support setting up large-scale, export-competitive integrated batteries and cell-manufacturing giga plants in India, as well as localizing production across the entire electric vehicle value chain. On April 20, 2022, the think tank released a draft battery swapping policy and invited comments from relevant stakeholders by June 5, 2022. The draft policy, which will be valid till March 31, 2025 from the date of its notification, is specifically designed for battery swapping systems to be used for two-wheelers and three-wheelers.
States/union territories policy
Over 27 states and UTs have formulated strategy plans for transforming mobility to provide their citizens with safe, inclusive, economic, and clean transport options. While some states like Karnataka and Tamil Nadu have had a head start due to preplanned public policies, targeted investor incentives, as well as support infrastructure, other states too have drafted policies to stimulate market demand and create infrastructure.
Most recently, in September, Assam announced its Electric Vehicle Policy, 2021 and plans to phase out fuel-based vehicles by 2030. As a first step, the Assam government shall convert all government vehicles and its public bus fleet to EV alternatives. The state also aims to deploy 200,000 electric vehicles in the next five years. Assam’s Industries, Commerce and Public Enterprises Department said the new EV Policy incentivizes people to switch to EVs. Assam also offers several incentives for EV manufacturing in the state (under the North East Industrial Development Scheme, 2017 and the Industrial and Investment Policy of Assam, 2019).
Electric Vehicle Policy in Indian States
Key policy targets
Maharashtra Electric Vehicle Policy, 2021
· Issued in July, 2021. Valid till March 31, 2025
· Budget outlay of INR 9.3 billion (US$124.97 million).
· Achieve 10% share of EVs in all new vehicle registrations by 2025.
· Attain 25% electrification of public transportation and last mile delivery vehicle in five targeted urban agglomerations of Greater Mumbai, Pune, Nashik, Nagpur and Aurangabad by 2025.
· Several purchase incentives across all segments of EVs, including e-buses.
· Incentives for battery recycling.
· Set up at least one Gigafactory for manufacturing of Advanced Chemistry Cell (ACC) batteries in the state.
· Establish charging infrastructure across the state as well as connecting highways. Incentives for setting up charging stations.
· Issued in August, 2021. Valid for five years
· Achieve adoption of 20% EVs in all vehicle registrations in the state by 2025. The focus segments are two-wheelers, three-wheelers, four-wheelers, and electric buses.
· Waivers on road tax and registration fees during policy period.
· Incentives for EV and component manufacturing, including batteries.
· Additional incentives for setting up both public and private charging infrastructure.
· Additional sops for Lithium Ion battery manufacturing.
Assam Electric Vehicle Policy, 2021
· Issued in September, 2021. Valid for five years.
· Achieve 25% penetration of EVs in the total number of vehicle registrations in Assam.
· Support deployment of 200,000 EVs over the next five years. The segment wise breakup of this target is:
o Two-wheeler EVs – 100,000 units;
o Three-wheeler EVs – 75,000 units; and
o Four-wheeler EVs – 25,000 units.
· Offer incentives for EV and component manufacturing.
· Focus on recycling policy for batteries.
Gujarat State Electric Vehicle Policy, 2021
· Issued in June, 2021. Valid till 2025.
· Budget outlay of INR 8.7 billion (US$116.90 million)
· Support deployment of 2,00,000 EVs over next four years. The segment wise breakup of this target is:
o Two-wheelers EVs– 1,10,000 units
o Three-wheelers EVs – 70,000 units
o Four-wheelers EVs– 20,000 units
· The incentives on EVs will be based on battery capacity, available up to INR 10,000(US$134.40)/kwh.
· All EVs will be exempt from payment of registration fees.
· Policy incentives for boosting the charging infrastructure in the state.
Rajasthan Electric Vehicle Policy, 2021
· Issued in July 2021. Valid till March 31,2022.
· All EVs purchased before March 2022 will be eligible for State Goods and Services Tax (SGST) refund.
· Additional purchase incentive for electric two wheelers and three wheelers.
· Issued on June 3, 2021. Valid for five years since notification.
· Goal of one million EVs in the state across all segments during the policy implementation period.
· Goal of establishing 100,000 public/semi-public charging stations in the next five years.
· Achieve EV/Public charge point ratio of eight.
· Recycling and reusing old batteries and discarding unusable batteries in an environment friendly manner.
· Establishment of “EV Accelerator Cell”
· Facilitate public charging infrastructure for EVs through DISCOMs.
· Issued in March, 2021. Valid for period of five years since notification.
· Seeks adoption of at least 15% EVs in the state in next five years by offering incentives.
· Facilitate adoption of 20,000 EVs during the policy implementation period.
· All types of EVs purchased during policy period shall be exempt from payment of registration fees and road tax.
· Purchase subsidy of INR 10,000 (US$134.40)/kwh for the first 3,500 electric two-wheelers priced below INR 150,000 (US$2016.06)
· Purchase subsidy of INR 4,000 (US$53.76)/kwh for first 200 electric three-wheelers priced below INR 500,000 (US$6720.20)
· Purchase subsidy of INR4,000 (US$53.76)/kwh to the first 30 hybrid four-wheelers priced below INR 1.5 million (US$20,160).
· Boost charging infrastructure by encouraging private investment.
· Encourage reuse and recycling of batteries.
· Goal of one million EVs by 2024.
· Goal of 100,000 slow and fast EV charging stations by 2024.
· Government plans to stop registration of petrol and diesel cars by 2024 in the upcoming capital city of Amaravati.
· All government vehicles, including corporations, boards, and government ambulances to be electric by 2024.
NCT of Delhi
· Aims to have at least 50% e-buses for all new stage carriage buses procured for the city fleet, starting with 1,000 e-buses by 2020.
· Aims for 25% of new vehicle registrations to be electric by 2024.
· A purchase incentive of INR 5,000 (US$68) per kWh of battery capacity provided for two-wheelers and subject to a maximum incentive of INR 30,000 (US$409) per vehicle.
· Incentive for scrapping and de-registering old highly polluting two-wheelers.
· A purchase incentive of INR 10,000 (US$136) per kWh of battery capacity provided for electric four-wheelers (cars) (subject to a maximum incentive of INR 150,000 (US$2,039) per vehicle) for the first 1,000 e-cars registered in New Delhi after issuance of the policy.
· Purchase incentive of INR 30,000 (US$409) per vehicle to owners of e-autos, e-rickshaws, and e-carts.
· 100% of three and four-wheelers moving goods will be encouraged to transition to electric by 2030.
· Local public transport bus fleets to introduce 1,000 EV buses.
· Aim to set up 112 EV charging stations in Bengaluru.
· Focus on venture capital fund for e-mobility start-ups and creation of secondary market for batteries.
· Incentives such as interest free loans on net SGST for EV manufacturing enterprises.
· Target of bringing one million EVs to the state by 2022 and 6000 e-buses in public transport by 2025.
· Viability gap funding for e-buses and government fleet.
· Incentives such as tax breaks, road tax exemptions, toll charge exemption, free permits for fleet drivers and free parking.
· Priority to EV component manufacturing.
· 100% exemption of road tax and registration fee for the initial electric vehicles purchases.
· EV sales target to achieve 80% two- and three-wheelers (motorcycles, scooters, auto-rickshaws), 70% commercial cars (ride-hailing companies, such as Ola and Uber), 40% buses, 30% private cars, 15% electrification of all vehicles by 2025.
· Job creation for 20,000 workers by 2025 through EVs in shared mobility, EV manufacturing, and charging infrastructure development.
· Rolling out 1 million EVs combined across all segments by 2024.
· Goal of 1,000 electric buses deployed in the state by 2030.
· Target of achieving 70% electrification of public transportation by 2030 on identified green routes in 10 identified EV cities (Noida, Ghaziabad, Meerut, Mathura, Agra, Kanpur, Lucknow, Allahabad, Gorakhpur, and Varanasi).
· Set up around 0.2 million slow and fast charging and swapping stations by 2024.
· Establishes single-window system in place for all approvals required for EV and battery manufacturing units.
· Rapid EV adoption and contribution to 25% of all new public transport vehicle registrations by 2026.
· Some cities will stop registering new internal combustion engine (ICE) autos.
· Enable faster adoption by ensuring safe, affordable, and accessible charging infrastructure.
· Shared e-rickshaws and electric auto-rickshaws incentives: free cost of permits, exemption/reimbursement from road tax/vehicle registration fees for five years, and 100% wavier on parking chargers at any municipal corporation run parking facility for 5 years.
· Electrify 5% of buses every year by 2030, and convert shared mobility fleets, institutional vehicles, and e-commerce delivery and logistics vehicles to EVs by 2030.
· Convert all auto rickshaws in six major cities to EVs within a span of 10 years.
· Establish venture capital and business incubation service hubs to encourage electric vehicle start-ups.
· EV-related and charging infrastructure manufacturing units will receive 100% exemption on electricity tax till 2025.
· Aimed at 100% electrification of public transport, including e-buses; shared mobility, including e-bikes, e-taxis; and goods transport using electric two-, three-, and four-wheelers and other mini goods transport vehicles in five priority cities by 2030.
· 100% electricity duty exemption and stage carriage permit exemption for five years from date of commercial production.
· Exempts the first 100,000 EV buyers from motor vehicles tax for five years.
· Priority to electrification of rickshaws. Target of converting all paddle rickshaws to e-rickshaws by 2022.
· Promotion to manufacturing of e-rickshaws.
· Set up fast-charging stations at intervals of 50 km on state and national highways and charging stations at commercial and residential locations.
· Aims for 100% transition to EVs by 2030.
· Draft promotes creation of dedicated charging infrastructure and includes a provision for charging points in commercial buildings.
Challenges faced by EV industry
- Insufficient charging infrastructure: In 2019, there were only 650 charging stations in India as against over 0.3 million in China. Lack of sufficient charging infrastructure is one of the primary reasons why customers often refrain from purchasing EVs.
- High costs: Along with the range anxiety (kms/charge), another major concern among the potential customers is the current high price of EVs. As compared to lower-end (internal combustion engine) ICE cars, electric cars in the same segment tend to be more expensive. This is mainly because of the higher cost of technology used in the EVs, which constitutes a substantial portion of the cost, not leaving much scope for other features usually available in premium cars. It is expected that in future, with increased R&D and market competitiveness, the price factor will be rationalized to suit the price sensitivity, which in India is a primary factor influencing purchase, especially in the lower-end car segment.
With the recent announcement of subsidies, the price rationalization of EVs in the two-wheeler segment is on cards. Since the government’s fast-changing priorities are now biased towards sustainable, clean electric mobility, industry watchers expect a similar push towards easing adoption of other electric vehicles like cars and buses soon.
- Limited options: Since it is still a budding industry in India, customers have a very limited range of products to choose from. Increased investment in the sector will make it more competitive in due time and this will help create further demand.
- Lower mileage: Since the industry is young, there is immense scope for R&D. As of today, EVs in India are not cost competitive to an average customer as internal combustion engine (ICE) vehicles prove to be more cost effective.
- Higher dependency on imports: Reliance on imports of battery as well as other components is also one of the factors adding to the cost of EVs in India.
- Grid challenges: Another concern is regarding the price of charging EVs at private charging stations once EVs become mainstream. According to Brookings India, projections for 2030 show that even with a fair penetration of EVs, the increase in demand for electricity is likely to be about 100 TWh (tera watt-hours) or about four percent of the total power generation capacity. So, increasing methods of power generation are necessary to meet that growth in demand.
Ultimately, the scope of India’s EV market growth rests on availability of capital for original equipment manufacturers, battery manufacturers, and charge point operators as well as improvements to infrastructure and diversified options for consumers.
Realizing India’s EV ambition will also require an estimated annual battery capacity of 158 GWh by FY 2030, which provides huge investment opportunities for investors. Enabling policy support measures are a critical need at this juncture.
The government appears to be aware of this. It has been rolling out incentives to boost market demand in priority segments like electric two-wheelers, and localizing production of key components like ACC battery storage as well as electric vehicles and auto components through respective PLI schemes. Besides, several Indian states have now passed EV policies intending to attract industry investments and make EV adoption more viable proposition for the consumer market.
This article was originally published on March 11, 2021. It was last updated April 11, 2022.
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