Promotion of Electric Vehicles

  Jul 25, 2020

Promotion of Electric Vehicles

Why does India need EVs?

  1. To reduce import dependency on oil, which is more than 80% of our need
  2. Reduce air pollution
  3. Spill over benefits in heath sector, reduced spending on illness
  4. Pollution causes premature death of working age population; this will be eliminated with of EVs
  5. Opportunities for disruptive technology in automobile sector, entrepreneurship
  6. Creation of jobs in sector
  7. Ease of living 

What challenges India is facing in implementation of EVs?

  1. Shift of pollution from vehicular to thermal power station led pollution 
  2. Shift from oil dependence to dependence on china for lithium/cobalt and rare earth metals
  3. Automobile sector already under crisis
  4. Competitive pricing of EVs vis a vis conventional vehicle
  5. Mechanics, maintenance and repair ecosystem is not ready
  6. Energy security 24X7 electricity still a challenge
  7. Charging infrastructure remains below need
  8. Power sector has its own challenges

What are the initiatives taken by government to promote EVs?

  1. Under new GST regime, GST on EVS is reduced from existing 12% rate to 5% as against the 28% GST rate with cess up to 22% for conventional vehicles.
  2. The National Electric Mobility Mission Plan (NEMMP) 2020, FAME1 and FAME 2
  3. Ministry of Power has allowed sale of electricity as ‘service’ for charging of electric vehicles. This will provide a huge incentive to attract investments into charging infrastructure.
  4. The Government has also granted exemption to the battery-operated transport vehicles and transport vehicles running on ethanol and methanol fuels from the requirements of permit.
  5. The Government has proposed exemption of registration fees for battery operated/electric vehicles to promote the use of eco-friendly vehicles in the country.
  6. Budget of 2019-20 announced for providing additional income tax deduction of Rs 1.5 lakh on the interest paid on loans taken to purchase electric vehicles.
  7. Ministry of Road Transport and Highways has allowed the age group of 16-18 years to obtain driving license to drive E-scooters.
  8. Ministry of Road Transport and Highways has issued an advisory dated to all States and Union Territories to promote use of electric vehicles.

What is the way forward for EVs?

  1. Promote charging infrastructure
  2. Strategic purchase of rare earth element in other countries, focus on sea floor minerals
  3. Make electricity power generation greener through super critical technology, solar, wind, and nuclear
  4. R&D in nuclear fusion like china’s artificial sun
  5. Other forms of green mobility need to be promoted, like fuel cell technology, cycling, hyperloop
  6. Vehicle scrappage plan 
  7. Battery swapping arrangement