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Key Questions about the Indian EV Ecosystem that remain Unanswered 

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The problem with the Indian governance and policy-making in recent times is that it has been more interesting in marketing and publicity rather than work on developing and planning solar policies and roadmaps for different sectors of the economy. While efforts are being made in many directions, the planning process remains woefully inadequate and sometimes lead to huge disasters. Demonetization is a prime example of the failed planning process which had led to huge losses.

Most of the other times it does not lead to a disaster but creates lost opportunities for the citizens. The EV industry which is expected to become a multi-hundred billion dollar industry for India over the next 10-15 years, is one such sector which has become a victim to the failed policymaking.

Hero Electric scooters

While recently 15 Electric Vehicles were inaugurated with much fanfare by the Finance Ministry with a number of ministers and secretaries cutting the ribbon on Mahindra eVerito cars, huge questions remain unanswered by the policymakers regarding the future of the industry. Unless these are well thought through and defined, the EV industry will keep lurching here and there. There has been no comprehensive policy and vision despite the multitude of industries and think tanks working on the EV industry policy and regulations over the last two years. The incumbent ICE automobile industry has been a huge culprit as it has been lobbying against the EV industry as it sees the new parading hurting its revenues and profits.

Some of the key things that need clarifications are:

1) Will India develop its own battery supply chain or will it be dependent on imports? Which parts will the country focus on and what kind of long term support will it get. As part of the FAME policy, the government wants mostly to focus on supporting domestic manufacturing of batteries and not too much on providing incentives for buying vehicles.

2) Will hybrid vehicles be supported along with pure 100% electric vehicles or just EVs only?  This is important as large investments might be needed for making hybrids which might go waste if there is no policy support. Existing automakers such as Toyota want support for hybrids which many experts see as a waste of money.

3) Will the incentives for EVs come by putting a cess on ICE vehicles as per the “feebate” policy which is followed by many countries? This is being opposed tooth and nail by the ICE industry who do not want additional taxes and cess. As the government does not have much of a budget for EV support, this might lead to a delayed introduction of EVs without any support to bridge the gap between ICE and EVs over this period of transition in the next 5 years.

4) Will India support battery swapping and normal charging infrastructure or just normal charging infrastructure? This clarity is again needed for large investments to be made, by swapping infrastructure providers such as Sun Mobility. Related questions are whether there will be battery standardization or will battery swapping be there only for buses, three-wheelers, and two-wheelers.

There are many questions which the government needs to urgently clarify as billions of dollars in investments will be based on which direction the government takes. The Indian government till date has done things in an extremely ad-hoc manner giving no clarity to industry players. While investments are already being made in different parts of the ecosystem, serious and large players have not made any major commitments till date unless they see action by the government. A comprehensive policy and roadmap for the EV sector is the need of the hour but will the government rise to the occasion?

PG

Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to greensneha@yahoo.in

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