{"id":5879,"date":"2022-06-01T00:00:00","date_gmt":"2022-06-01T00:00:00","guid":{"rendered":"https:\/\/www.nextias.com\/current_affairs\/uncategorized\/01-06-2022\/electric-vehiclesevspolicies-of-india\/"},"modified":"2022-06-01T00:00:00","modified_gmt":"2022-06-01T00:00:00","slug":"electric-vehiclesevspolicies-of-india","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/editorial-analysis\/01-06-2022\/electric-vehiclesevspolicies-of-india","title":{"rendered":"Electric Vehicles(EVs)Policies of India"},"content":{"rendered":"

In Context\u00a0<\/u><\/strong><\/span><\/span><\/span><\/p>\n

The EV policies put in place by some States as part of FAME-II have been instrumental in driving this growth.<\/span><\/span><\/span><\/p>\n

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What are Electric Vehicles?<\/u><\/strong><\/span><\/span><\/span><\/p>\n

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  • They operate on an <\/span><\/span><\/span>electric motor<\/strong><\/span><\/span><\/span>, instead of an <\/span><\/span><\/span>internal-combustion engine <\/strong><\/span><\/span><\/span>that <\/span><\/span><\/span>generates power by burning a mix of fuel and gases.<\/strong><\/span><\/span><\/span>\u00a0<\/span><\/span><\/span><\/li>\n
  • Therefore, such a vehicle is seen as a possible replacement for current-generation automobiles, in order to address the issue of rising pollution, global warming, depleting natural resources, etc.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

    Indian Policies on EVs<\/u><\/strong><\/span><\/span><\/span><\/p>\n

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    • The government introduced a slew of measures in line with the \u2018<\/span><\/span><\/span>Make in India\u2019 <\/strong><\/span><\/span><\/span>campaign to<\/span><\/span><\/span> incentivise manufacturers<\/strong><\/span><\/span><\/span> to <\/span><\/span><\/span>produce components locally<\/strong><\/span><\/span><\/span> and <\/span><\/span><\/span>build <\/strong><\/span><\/span><\/span>a <\/span><\/span><\/span>structured policy framework<\/strong><\/span><\/span><\/span> as India is heavily dependent on China for <\/span><\/span><\/span>lithium supply chains constraining the widespread deployment of EVs.<\/strong><\/span><\/span><\/span><\/li>\n<\/ul>\n
        \n
      • In <\/span><\/span><\/span>2010<\/strong><\/span><\/span><\/span>, the <\/span><\/span><\/span>Ministry of New and Renewable Energy<\/strong><\/span><\/span><\/span> (MNRE), announced a <\/span><\/span><\/span>financial incentive for manufacturers for EVs<\/strong><\/span><\/span><\/span> sold in India.<\/span><\/span><\/span>\n
          \n
        • The<\/span><\/span><\/span> Rs 95-crore scheme<\/strong><\/span><\/span><\/span> envisaged<\/span><\/span><\/span> incentives of up to 20 per cent on ex-factory prices of vehicles<\/strong><\/span><\/span><\/span>, subject to a maximum limit.<\/span><\/span><\/span><\/li>\n
        • It was the <\/span><\/span><\/span>first concrete decision<\/strong><\/span><\/span><\/span> to incentivise EVs. However, it was <\/span><\/span><\/span>withdrawn <\/strong><\/span><\/span><\/span>by the MNRE in <\/span><\/span><\/span>March 2012<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
        • In <\/span><\/span><\/span>2013<\/strong><\/span><\/span><\/span>, India unveiled the <\/span><\/span><\/span>National Electric Mobility Mission Plan<\/strong><\/span><\/span><\/span> (NEMMP) <\/span><\/span><\/span>2020<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span>\n
            \n
          • It aimed to make a major <\/span><\/span><\/span>shift to EVs<\/strong><\/span><\/span><\/span> and to address the <\/span><\/span><\/span>issues of national energy security<\/strong><\/span><\/span><\/span>, <\/span><\/span><\/span>vehicular pollution<\/strong><\/span><\/span><\/span> and <\/span><\/span><\/span>growth of domestic manufacturing capabilities<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span><\/li>\n
          • It offered <\/span><\/span><\/span>subsidies <\/strong><\/span><\/span><\/span>and created a <\/span><\/span><\/span>supporting infrastructure<\/strong><\/span><\/span><\/span> for e-vehicles but the plan <\/span><\/span><\/span>has not been implemented<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
          • In the <\/span><\/span><\/span>Union Budget 2015-16<\/strong><\/span><\/span><\/span>, the \u2018<\/span><\/span><\/span>Faster Adoption and Manufacturing of EVs<\/strong><\/span><\/span><\/span>\u2019 (FAME) scheme was announced, with an initial outlay of <\/span><\/span><\/span>Rs. 75 crore<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span>\n
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            • It aimed to offer <\/span><\/span><\/span>incentives for clean-fuel technology cars <\/strong><\/span><\/span><\/span>to boost their sales to up to <\/span><\/span><\/span>7 million vehicles by 2020<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
            • In <\/span><\/span><\/span>2017<\/strong><\/span><\/span><\/span>, the Transport Ministry highlighted its <\/span><\/span><\/span>intent to move to 100 per cent electric cars <\/strong><\/span><\/span><\/span>by <\/span><\/span><\/span>2030<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span>\n
                \n
              • However, the automobile industry raised concerns over the execution of such a plan, so the government subsequently<\/span><\/span><\/span> diluted the plan to 30 per cen<\/strong><\/span><\/span><\/span>t.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
              • In <\/span><\/span><\/span>February 2019<\/strong><\/span><\/span><\/span>, the Union Cabinet cleared an <\/span><\/span><\/span>Rs. 10,000-crore programme <\/strong><\/span><\/span><\/span>under the <\/span><\/span><\/span>FAME-II scheme <\/strong><\/span><\/span><\/span>for promotion of Electric Mobility in the country.<\/span><\/span><\/span>\n
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                • Objective<\/span><\/span><\/span>\n
                    \n
                  • To encourage faster adoption of electric and hybrid vehicles by offering <\/span><\/span><\/span>upfront incentives on the purchase<\/strong><\/span><\/span><\/span> of EVs.<\/span><\/span><\/span><\/li>\n
                  • Also by <\/span><\/span><\/span>establishing the necessary charging infrastructure<\/strong><\/span><\/span><\/span> for EVs.<\/span><\/span><\/span><\/li>\n
                  • The scheme will help in addressing the issue of environmental pollution and fuel security.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n
                      \n
                    • Initially envisioned for three years, FAME-II got a two-year extension in June 2021 owing to a number of factors including the pandemic.<\/span><\/span><\/span><\/li>\n
                    • \u00a0It aims to<\/span><\/span><\/span> support 10 lakh e-two-wheelers, 5 lakh e-three-wheelers, 55,000 <\/strong><\/span><\/span><\/span>e-four-wheeler passenger cars and 7,000 e-buses.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n
                        \n
                      • In the 2022 budget<\/strong><\/span><\/span><\/span>, a battery swapping policy was announced as an easier way to charge EVs.\u00a0<\/span><\/span><\/span>\n
                          \n
                        • \u00a0The battery swapping model for supplying power has side-stepped the lack of charging infrastructure but the future is likely to see a mix of both models.<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
                        • The government also announced a Production Linked Incentive scheme for automakers, a part of which aims to boost electric vehicles manufacturing.<\/span><\/span><\/span><\/li>\n<\/ul>\n
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                          \n

                          Data Analysis\u00a0<\/u><\/strong><\/span><\/span><\/span><\/p>\n

                            \n
                          • Three-wheeler EVs like e-autos and e-rickshaws account for close to <\/span><\/span><\/span>65% of all EVs registered in India.<\/strong><\/span><\/span><\/span><\/li>\n
                          • \u00a0In contrast,<\/span><\/span><\/span> two-wheeler EVs<\/strong><\/span><\/span><\/span> come at a <\/span><\/span><\/span>distant second with over 30%<\/strong><\/span><\/span><\/span> of registrations and passenger <\/span><\/span><\/span>four-wheeler EVs at a meagre 2.5%<\/strong><\/span><\/span><\/span>.\u00a0<\/span><\/span><\/span><\/li>\n
                          • Under the targets for FAME-II, e-three-wheelers have crossed over 4 lakh vehicles of the 5-lakh target since 2019.<\/span><\/span><\/span>\n
                              \n
                            • At the current rate, e-three-wheelers are expected to breach the 5-lakh target by 2023.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
                            • The EV registrations data show that Assam, Bihar, Delhi, Uttar Pradesh and West Bengal account for close to 80% of all e-three-wheeler registrations, with U.P. accounting for close to 40% of all registrations. .<\/span><\/span><\/span>\n
                                \n
                              • The focus of the EV policies of these five States is on accelerating adoption of EVs among consumers and promoting local manufacturing.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n
                                  \n
                                • The success India has <\/span><\/span><\/span>experienced in the e-three-wheeler space<\/strong><\/span><\/span><\/span> has come from developing both the demand and supply sides.\u00a0<\/span><\/span><\/span>\n
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                                  • Subsidies, tax exemptions, and interest-free loans have successfully rallied demand for these vehicles.\u00a0<\/span><\/span><\/span><\/li>\n
                                  • These vehicles provide for inexpensive means of transport for millions, are easy to maintain, and have relatively low operating costs, making them immensely popular among operators.\u00a0<\/span><\/span><\/span><\/li>\n
                                  • The indigenous design allows for easy local manufacturing in workshops and small enterprises and makes them relatively easy to charge and maintain compared to their two-wheeler and four-wheeler counterparts.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n

                                    Challenges \/Issues\u00a0<\/u><\/strong><\/span><\/span><\/span><\/p>\n

                                      \n
                                    • India\u2019s road to a fully-electric ecosystem still has a few hurdles – <\/span><\/span><\/span>High cost,<\/strong><\/span><\/span><\/span> <\/span><\/span><\/span>inadequate infrastructure, lack of high performing EVs<\/strong><\/span><\/span><\/span> .<\/span><\/span><\/span><\/li>\n
                                    • \u00a0Local manufacturing enterprises lack the necessary resources or the motivation to invest in<\/span><\/span><\/span> design developments.<\/strong><\/span><\/span><\/span><\/li>\n
                                    • The absence of a robust<\/span><\/span><\/span> manufacturing ecosystem<\/strong><\/span><\/span><\/span> for the materials associated with the EV revolution, coupled with th<\/span><\/span><\/span>e concentration of the supply chain in certain regions<\/strong><\/span><\/span><\/span>.<\/span><\/span><\/span><\/li>\n
                                    • Li-ion batteries are complex devices requiring<\/strong><\/span><\/span><\/span> a level of sophistication that can take years to perfect.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n
                                        \n
                                      • Hurrying the development of this complex technology without careful safeguards can lead to increasing safety incidents, as evidenced recently on Indian roads.<\/span><\/span><\/span><\/li>\n<\/ul>\n
                                          \n
                                        • The success in the e-three-wheeler space has been difficult to replicate in the e-two-wheeler and e-four-wheeler space, which have problems both on the demand and supply side.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n

                                          Way Forward\u00a0<\/u><\/strong><\/span><\/span><\/span><\/p>\n

                                            \n
                                          • The <\/span><\/span><\/span>current policies<\/strong><\/span><\/span><\/span> in place at the State level have spurred an e-three-wheeler dominance but it has come at some costs therefore subsequent <\/span><\/span><\/span>EV policies must pay special attention to adequate passenger safety.\u00a0<\/strong><\/span><\/span><\/span>\n
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                                            • Future policies must therefore incorporate appropriate design and passenger safety standards.\u00a0<\/span><\/span><\/span><\/li>\n<\/ul>\n<\/li>\n
                                            • Future EV policies must take into account the<\/span><\/span><\/span> existing and emerging stakeholders on the demand and supply sides <\/strong><\/span><\/span><\/span>for effective implementation.<\/span><\/span><\/span><\/li>\n
                                            • With the prevailing trajectory of EVs, India must take lessons from its e-three-wheeler success story to sustain its EV ambitions.<\/span><\/span><\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"

                                              In Context\u00a0 The EV policies put in place by some States as part of FAME-II have been instrumental in driving this growth. What are Electric Vehicles? They operate on an electric motor, instead of an internal-combustion engine that generates power by burning a mix of fuel and gases.\u00a0 Therefore, such a vehicle is seen as […]<\/p>\n","protected":false},"author":1,"featured_media":5880,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[22],"tags":[26,46],"class_list":["post-5879","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-editorial-analysis","tag-gs-3","tag-indian-economy-related-issues"],"acf":[],"jetpack_featured_media_url":"https:\/\/wp-images.nextias.com\/cdn-cgi\/image\/format=auto\/ca\/uploads\/2023\/07\/144030Screenshot_6.png","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/5879","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=5879"}],"version-history":[{"count":0,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/5879\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media\/5880"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=5879"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=5879"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=5879"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}