A WAVE OF ELECTRIC VEHICLES: NEW POLICIES AND SCHEMES

• Publish on May 01, 2024
• Read Time 5 min

India's recent announcement regarding its electric vehicle (EV) policy marks a significant milestone in the country's journey towards sustainable transportation. With a focus on promoting EV adoption and fostering investment in the sector, the policy opens doors for the import of electric vehicles from any country, including China. Let's delve into the key provisions of this groundbreaking policy and the opportunities it presents for the EV industry.

 1. Import Flexibility:
The new EV policy eliminates restrictions on the import of electric vehicles from any country, providing manufacturers with the flexibility to source EVs globally. This move is expected to encourage competition and innovation in the Indian EV market, as manufacturers can leverage international expertise and technology to meet consumer demand.

 2. Import Duty Concessions:
To incentivize companies to establish manufacturing units in India, the policy offers import duty concessions to those investing a minimum of USD 500 million in the country. This financial incentive aims to attract foreign investment and stimulate the growth of domestic EV manufacturing infrastructure.

 3. Customs Duty Reduction:
Companies setting up manufacturing facilities for EV passenger cars will benefit from reduced customs/import duty rates for imported vehicles. Under the policy, eligible manufacturers can import a limited number of cars at a lower duty rate of 15% for vehicles priced at USD 35,000 and above. This concession will apply for five years from the issuance of the government's approval letter, providing a window of opportunity for companies to establish their presence in the Indian market.

 4. Promoting Domestic Manufacturing:
While facilitating imports, the EV policy also aims to boost domestic manufacturing of electric vehicles. By offering import duty concessions to companies investing in local manufacturing facilities, the government incentivizes the establishment of EV production units within the country. This approach not only creates employment opportunities but also strengthens India's position as a hub for EV manufacturing and innovation.

 5. Fostering Sustainable Growth:
India's new EV policy aligns with the country's broader sustainability goals and commitment to reducing carbon emissions. By promoting the adoption of electric vehicles, the policy contributes to mitigating air pollution and addressing climate change. Additionally, the focus on attracting investments in EV manufacturing reflects India's ambition to become a global leader in the transition to clean energy and sustainable transportation solutions.

India's new EV policy represents a significant step towards accelerating the adoption of electric vehicles and fostering growth in the EV industry. By removing import restrictions, offering import duty concessions, and promoting domestic manufacturing, the policy creates a favorable environment for companies to invest in and contribute to India's evolving EV ecosystem. With these measures in place, India is poised to emerge as a key player in the global electric vehicle market  while driving sustainable mobility.