Electric Vehicles (EV) sales in India grew at an impressive rate of 37.5% in 2015-16. Although this growth paints a healthy picture for India’s EV industry, the reality can be gauged from the 2011-12 sales figures which were much higher. India’s Power Minister recently said the country will become the first “100% electric vehicle nation” by 2030. Can India electrify the auto industry? Sales of electric vehicles (EVs) in India grew by 37.5% to 22,000 units in the year ended 31 March, up from 16,000 the year before. Of these only 2,000 units were four wheelers. At these levels, India remains miles away from its objective of selling 6 million electric vehicles by 2020, a vision stated by the government through the National Electric Mobility Mission Plan (NEMMP) 2020. Mahindra Reva – the only electric car maker in India – witnessed a two fold jump in sales in Delhi after the Supreme Court banned sales of big cars and sports utility vehicles in the NCR in December. What these reports doesn’t tell us is, the number of electric two wheeler makers has fallen (75%) from 28 in 2011-12 to seven in 2014-15. Total electric vehicles sold in 2014-15 has decreased (84%) from 1,00,000 in 2011-12 to approx 16,000 in 2014-15.
Rollback of previous subsidies with delay in implementing NMEMP is highly detrimental to the industry. Intentions at policy level abound but government at every level, be it Center, State or Municipal now has to go the extra mile to facilitate mass migration to green mobility. Lack of basic infrastructure facilities like charging stations and difficulties in availing credit from banks for buying such vehicles are directly related to the growth of the sector.
To promote Eco-friendly vehicles, the government launched the FAME India scheme in April 2015 offering incentives on electric and hybrid vehicles of up to Rs 29,000 for bikes and Rs 1.38 lakh for cars. Batteries account for almost a third of the cost of building an electric car. Fortunately, the cost of batteries is coming down every year at a relatively faster rate than expected. Having registered its 50,000th electric car in April 2015, Norway is leading the global market for electric vehicles. The EVs represent a third of all new vehicle registrations. Norway is also the most generous country when it comes to subsidizing the EV industry. Truth be told, political will and eloquence aside, India is a lifetime away from being a EV nation.
The government is working on a scheme that also seems a bit far fetched at present. Aside from having dates like 2020, 2030, there is little clarity on long term policy and even less incentives for the makers, sellers and buyers of EVs. India is the third country in the world to announce its intention to become 100% electric. The other two are Norway and The Netherlands. The Dutch and Norwegians are fairly rich; Indians, less so. The Supreme Court will have to become more active in curtailing the pollution caused by the internal combustion engines. It is only a matter of time before blanket bans are imposed.
The government should channel the entrepreneurial spirit of the country to focus on how electric vehicles could be made affordable. Incentives have to be given, perhaps a lot of them for the next 10 years. Indian government will have to lay down more and more plans, that can really be implemented, if it wants to achieve the goals they planned for. We’re looking forward to more official updates on this topic, so stay tuned and buy an EV.