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India pushes Electric Vehicles hard but Efforts not Bearing Fruits as of Now

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India has been making a lot of noise about Electric Vehicles over the past two years as this new technology has the potential of reducing and even eliminating the country’s biggest vulnerability – more than a hundred billion dollars in oil imports every year. India is highly susceptible to the price of crude oil as it imports vast quantities of this commodity every year. Increase in oil prices lead to fiscal deficits, rising inflation, and interest rates and leads to a cut in GDP growth.

EVs also have the potential to sharply reduce India air pollution which has reached alarming levels in its cities, and improve the country’s energy security as it will not be dependent on the Gulf countries for its critical energy needs. However, like all other things, government efforts have come out to be uncoordinated, ad-hoc and shows muddled thinking. Each minister comes out with his own policy which is soon contradicted by other ministers. Foreign interests especially the powerful Japanese automakers like Suzuki and Toyota also influence and tweak the policies to suit their own interests. These automakers which have huge manufacturing operations and distribution networks in the country fear that this new technology will lead to an erosion of their market dominance.

Indian automakers like Mahindra and Tata are making huge investments into the EV space as they scent an opportunity to make a mark in the personal vehicle space which has long been dominated by the like of Hyundai, Suzuki, Toyota, and Honda. Also, read why Indian Car Makers Are Not Keen on Manufacturing Electric Vehicles.

Hero Electric scooters

Despite all the problems and issues, EV is a technology whose time has come and cannot be stopped. The technology keeps on improving every year with battery costs declining by 70% from 2010 to date. Already some vehicle segments like two wheelers and three wheelers are said to be on par with ICE vehicles on a total cost of ownership basis. It is expected that most parts of the automobile market will have reached parity with fossil fuel vehicles by 2022-2023 making it virtually impossible for vested interests to keep out EVs from the giant Indian market.

The FAME policy Phase 2 is expected to come out soon and this is supposed to have a lot of incentives to support domestic manufacturing rather than focus on increasing consumption. This is a good chance given that increasing consumption will not benefit the country much. However, manufacturing could lead to a huge increase in jobs, taxes etc. It is imperative that India be strong in EV manufacturing as this is going to be a hundred billion dollar plus industry given the huge size and growth expected of the Indian market.

States also are doing their bit in promoting EVs as they have come out with their own state policies and budgets to promote manufacturing and consumption. Delhi has come out with the best policy by far in terms of the policy elements and targets as the city wants 25% of its new vehicles to be EVs by 2023. It is also investing in providing subsidies for two-wheelers and setting up charging points across the city. Given the huge vehicle penetration in the city, this will give a huge boost to the country’s EV market. Check out the list of places where you can charge your electric vehicle for free in Delhi.


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

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