According to Prime Minister Narendra Modi in an exclusive interview with Moneycontrol, the government has been working to offer various incentives for the electric vehicle (EV) industry in order to achieve India’s sustainability goal of reducing carbon emissions. The conversation covered the G20, as well as global issues, the economy, and more.
The government has been putting effort into developing incentives for the electric vehicle market. According to Modi, the market has responded with more innovation, and consumers are responding by being more willing to try the alternative.
This occurs at a time when it is said that the Indian government is drafting a new electric vehicle policy that will lower import taxes for businesses that commit to doing some local manufacturing.
As opposed to the current policy, which levies a 100 percent tax on fully completed vehicles that cost more than $40,000 and a 70 percent tax on everything else, the proposed policy would permit automakers to import fully built electric vehicles into India at a reduced tax rate as low as 15 percent.
Future of the Indian EV sector:
The Ministry of Heavy Industries made the decision to reduce the FAME II scheme‘s subsidy on electric two-wheelers from Rs 15,000 per kWh to Rs 10,000 per kWh in June 2023. In addition to cutting the per-kWh incentive by Rs 5,000, the ministry also decreased the maximum subsidy cap from 40% of the vehicle’s ex-factory price to 15%.
The electric vehicle business has been witnessing fantastic acceptance despite the subsidy reduction. According to the government’s Vahan website, retail sales of EVs in July 2023 included goods- and passenger-carrying commercial vehicles as well as two-, three-, and four-wheeler (car and SUV) divisions.
In reality, sales of electric two-wheelers (E2Ws), which had plummeted in June as a result of the subsidy cuts, continued to rise in August. Compared to 45,000 units sold in June, over 59,000 E2Ws were sold in the nation in August. According to data taken from the Vahan website, the 59,313 units sold in August outsold the 54,498 automobiles sold in the previous month.
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