Govt Schemes Helped In Increasing EV Production In India

In order to attract both domestic and global industries for the manufacturing of electric vehicles in India, central government has taken various steps and launched variety of schemes to help the manufacturer. Minister Of Heavy Industries Mahendra Nath Pandey informed Lok Sabha that government has approved the Production Linked Incentive (PLI) Scheme for Automobile and Auto Components Industry in India for enhancing India’s manufacturing capabilities for Advanced Automotive Technology (AAT) products (including electric vehicles) with a budgetary outlay of INR 25,938 crore.

The PLI proposes financial incentives to boost domestic manufacturing of AAT products and attract investments in the automotive manufacturing value chain. Its prime objectives include overcoming cost disabilities, creating economies of scale and building a robust supply chain. The government launched the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) Scheme in 2015 and presently, Phase-II of FAME India Scheme is being implemented for a period of five years w.e.f. 01st April, 2019 with a total budgetary support of INR 10,000 crores.

This phase of FAME II focuses on supporting electrification of public and shared transportation through subsidies to 7,090 e-Buses, five lakh e-3 Wheelers, 55,000 e-4 Wheeler Passenger Cars and 10 lakh e-2 Wheelers.

On 12th May, 2021, the central government approved Production Linked Incentive (PLI) scheme, ‘National Programme on Advanced Chemistry Cells (ACC) Battery Storage’ in order to promote manufacturing in the country. The budgetary outlay of the scheme is INR 18,100 crores. The scheme envisages to establish a cumulative ACC battery manufacturing capacity of 50 GWh.

GST on electric vehicles and chargers and charging stations has been reduced to five per cent. In the backdrop of these schemes, the production of electric vehicles in the passenger vehicle category has increased in the last few years. As per the information received from Society of Indian Automobile Manufacturers (SIAM), the details on the production of Electric Vehicles in the passenger vehicle category, year-wise (financial year) are given below:

During the year 2019 and 2020 the production of passenger electric vehicles was 3,304 which was increased to 5,825 in 2021, 22,355 in 2022, and 62,279 in 2023. The production of these electric vehicles was 49,752 during the period of April 2023 and September 2023.

Meanwhile, Ministry of Road Transport & Highways (MoRTH) had announced to give green license plates to battery operated vehicles and to exempt from permit requirements. Further, MoRTH has issued a notification advising states to waive road tax on EVs, which in turn will help reduce the initial cost of EVs.

“Ministry of Heavy Industries under Capital Goods Scheme Phase-II has developed 23 skill training packages (Qualification Packs) through Automotive Skills Development Council (ASDC) pertaining to Electric vehicles,” the minister added. According to SMEV, a total of 91,455 E2W, 53766 E3W, 7500 E4W, and 271 e-buses were sold in November this year.