Electric Vehicle Industry in India | Government Initiatives & Manufacturers

Owing to the rising environmental concerns, Indian Government has committed to reducing CO2 emission intensity by 33-35% by 2030 from the level taken in 2005. The transport sector contributes an estimated 142 million tonnes of CO2 emissions annually in India and 90% of it is contributed by road transport only. Electric Vehicle Industry in India is evolving, and currently, there are about 1% Electric Vehicles as compared to traditional vehicles.

Indian Government Initiatives in the Electric Vehicle Industry

Government of India launched the Faster Adoption and Manufacturing of Hybrid & Electric Vehicles (FAME) scheme in 2015 and has sanctioned an amount of Rs. 795 crore for the project. Under Phase 2 of FAME, Govt of India is planning to extend the support to Rs. 8,730 crore which will span for 3 months. Energy Efficient Services Ltd has also issued tenders for 20,000 EVs for government use across India.

EV Manufacturers in India: There are around 100+ manufacturers of Electric Vehicles in India which manufacture various ranges of EVs. The various kind of EVs in production in India can be classified as below:

1. Electric Cars: Hyundai Kona, Mahindra e20, MG ZS EV, Tata Tigor EV, Tata Nexon EV
2. Electric Bikes: RV 300, RV 400 
3. Electric Scooters: Ather 450 & 450X, Bajaj Chetak, TVS iQube, Okinawa, Hero and many more
4. Electric Mini Pickup Truck: Mahindra, Tata Motors, Ashok Leyland and many more companies have launched electric pickup trucks in India
5. Hybrid Cars: Toyota Prius, MG Hector, Honda Accord, Maruti Swift, Maruti  Ciaz, Maruti Ertiga, Mahindra Scorpio, Volvo XC90, BMW i8

Government Moves towards Electric Vehicle Industry in India

                Over the last year or two, there has been an immense growth in startup companies coming in manufacturing of E-Bikes, Electric Scooters & Electric Charging Stations in India which is a good sign as it will not only contribute to this industry but will generate a large number of jobs.

India’s EV industry Government Initiatives- 2021

Despite of the country’s big aspirations, India’s EV market is still in its infancy. Looking at it another way, India has the world’s largest untapped market, particularly in the two-wheeler category. Underneath the automatic method, 100% foreign direct investment is permitted in this sector.

The federal government is also pushing the transition to sustainable transportation, as seen by recent changes to the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME) II plan to make electrical two-wheelers increasingly accessible.

Furthermore, a number of production-linked incentive schemes attempt to establish a local manufacturing ecosystems to support goals related to increased use of electric mobility transportation. This is hoped to be accomplished by stimulating new investments in the development of local supply chains for critical technology, goods, and car components.

Production-based incentive programmes

The government introduced a Manufacturing-Linked Incentive Scheme (PLI) for ACC Battery Storage Production in May 2021, that will encourage domestic manufacturing of these batteries & minimise reliance on imports. It will provide the EV sector with the necessary facilities while also drastically cutting the cost of EVs.

The government authorised a PLI Scheme for the car and drone industries on September 15, 2021, with the goal of incentivizing advanced and superior automotive engineered vehicles and services, particularly ‘green automotive production.

The automobile sector’s PLI Scheme is accessible to both existing automobile firms and new investors who are not presently involved in the vehicle or auto component manufacturing businesses. The scheme is made up of two parts:

1. Champion OEM Incentive Scheme: This is a’sales value related’ scheme that applies to all sectors of electric battery cars and hydrogen powered vehicles.
2. Component Champion Incentive Scheme: This is a’sales value linked’ scheme that applies to superior technology automotive parts, completely knocked down (CKD)/ moderately semi knocked down (SKD) kits, vehicular aggregates of 2-wheelers, 3-Ws, Passenger motor vehicles, commercial vehicles, as well as tractors, among other things.

Current Challenges in India

                The major challenge faced by the Indian EV industry is the availability of Charging Infrastructure and High cost of Lithium-ion Batteries. One more challenge in EVs manufactured in India is the time taken to charge the batteries, which is on the higher end compared to other EVs abroad.

                Society of Manufacturers of Electric Vehicles (SMEV) is an organization of Indian manufacturers of EV and its components. SMEV expects that after FAME-2 the EV industry will show a great jump in sales and implementation of new technologies. It will also generate a large number of jobs and reduce carbon emission in India. 

Source

EV Duniya Editorial: This article is updated by Kamalpreet Kaur