The most sustainable way for India to reduce its dependence on import of crude oil which is being subjected to heightened geo-political stress, is to speed up the country’s shift towards electric mobility which is being promoted not only by the Centre but also by several states offering competitive incentives for vehicle buyers and manufacturers and the trend would pick up even faster, an ASSOCHAM-NRI Consulting & Solutions joint report noted.
Several states like Delhi, Haryana, Maharashtra, Uttar Pradesh, Tamil Nadu, Andhra Pradesh and Telangana are implementing policies for promoting electric mobility.
“The current geo-political situation in different parts of the world only makes a stronger case for India to speed up our electric mobility”, ASSOCHAM Secretary General Deepak Sood said. He said India is vigorously promoting adoption of electric vehicles to accelerate the transition to green mobility and to achieve India’s net-zero target by 2070. The country has set an ambitious target of 30 percent electric vehicle penetration by 2030.
According to the report, with a staggering 87 percent of oil being imported, resulting in an import bill of approximately US$158.4 billion in FY23, the transportation sector alone consumes 40 percent of this imported oil, significantly impacting energy security.
Different states are following pro-active roles for EV promotion. ‘’The State EV policies are largely aligned with central policies targeting demand inside incentives and infrastructure improvements for EV adoption,” the ASSOCHAM- NRI Consulting & Solutions report pointed out.
Maharashtra’s EV policy aims to achieve at least 10 percent EVs by 2025 with 25 percent electrification of public transport. The state provides strong demand promotion fiscal incentives even as it actively aims to invite players to set up Gigafactory for battery production coupled with various incentives under the industrial policy. Maharashtra also provides capital subsidies for equipment purchases up to 50 percent for fast charging.
The Uttar Pradesh government has set targets for adopting electric vehicles. The state aims to have 1 million EVs on the road by 2024 and to transition 100 percent of public transportation to EVs by 2030. It has formulated the Comprehensive Electric Mobility Plan (CEMP) to guide the transition to EVs and invest in charging infrastructure. The government is also offering incentives to encourage the purchase of EVs, such as tax breaks and subsidies and has allocated an investment target of Rs 300 billion.
Tamil Nadu EV policy targets investments for EV OEM, component and battery manufacturers with capital and operational subsidies depending on size investment. The state targets installing 500,000 public charging stations (PCS) across cities, highways, and public parking areas.
Andhra Pradesh (AP) aims to electrify commercial and logistics fleets in the top 4 cities by 2024 and all cities by 2030. In terms of demand incentive, it provides a 100 percent road tax exemption. Its policy focuses on supply-side incentives including components and the development of clusters. It provides a 25 percent capital subsidy on Fixed Capital Investments (FCI), fixed power tariff reimbursements, and skill development incentives.
Haryana’s EV policy aims to make the state a global hub for electric mobility development and manufacturing of Electric Vehicles (EVs). The state provides subsidies up to 30 percent of subsidy on-road price of EVs as reimbursement directly to the buyer, along with exemption on registration, including incentives even for electric tractors. For charging infra developments, there is a 25% capital subsidy, land in major cities, and aims for standard creation in charging.
Telangana Electric Vehicle and Energy Storage Policy aims to attract investments worth US$ 4.4 billion in the EV sector by 2030 and to create 120,000 jobs in the sector. To support these goals, the state government has set up an innovation fund to support the development of new EV technologies and has exempted electric vehicles from road tax and registration fees. It is also investing in the development of charging infrastructure for electric vehicles, with plans to set up charging stations every 50 km on highways.
Delhi government aims to promote electric buses in public transportation. The government has set a target of 70 percent of buses in public transportation to be electric by 2025. It is also working to develop charging station infrastructure and make last-mile connectivity 100 percent electric.
Gujarat EV policy incentivises e-taxis, promotes EV and component manufacturing, and provides subsidies for EV charging stations. It offers incentives on e-taxis, such as a waiver of registration fees and road tax and also promotes EV and component manufacturing, such as batteries and e-motors. The policy provides a 25 percent capital subsidy on machinery for the first 250 EV charging stations.