Indian EV Market Remains Dead amid Government Hoopla and Announcements

The Indian government has been trying to push the growth of the Indian electric vehicle market through multiple means and has given a wide variety of incentives such as tax breaks, subsidies, etc. But like most other things, the execution capacity of the Indian state remains far from its intentions and grandiose plans. Though growing the EV market remains a key priority for the Indian government with multiple benefits for the country, the execution has been pathetic with ministries fighting with each other and industrial lobbies making the government do policy U-turns leading to a new clear roadmap for the industry.

The FAME 2 policy and the incentive package were poorly designed leading to almost zero growth for the overall EV market with the already pathetic numbers of EV cars being sold falling further to just 3400 EVs. With no incentives being given for private four-wheelers, there have been not many sales in terms of EV cars. The only segment which has gained is the slow two-wheelers which cost very little and with technology that is not really that cutting edge. While thousands of electric two-wheeler and three-wheelers are being sold, there is not much of a dent in the rest of the vehicle market which continues to guzzle millions of barrels of crude oil imports every year.

The Indian government should better design and implement the program in order to transition the automobile market to electricity as it wants to. Just announcements will not do much unless some concrete well thought of structured action takes place. Even in manufacturing nothing has happened though there have been tons of big announcements. While no one accepts the Indian state to be able to give large capital subsidies like other governments for four-wheelers, they could have done a better job in pushing two-wheelers and three-wheelers. Even the electric bus market has not really got going too much despite hefty incentives being announced. With the oil prices crashing, the economic case for a large part of the EV market has become much worse even as the overall demand craters with the onset of an economic crisis for a vast majority of the consumers. Though a lot of startups and private money has been thrown in the EV market given its huge potential and promise, the year 2020 should be a washout with some of the startups even seeing bankruptcies.