The Indian government has reportedly pressed the pedal on its plans to promote electric vehicles in the country. And in a bid to cut down vehicular pollution and reduce the amount spent on oil procurement, the government is proposing a new plan to attract $14 billion investment from global automakers.
This new scheme is said to be a clearly thought out plan and a part of India’s $27 billion Make-in-India scheme that aims at attracting companies to move their manufacturing base to India from hubs like China and Vietnam.
According to the documents seen by Reuters, this new scheme highlights the government's fresh and focused approach towards the industry and aims to drive huge investments over the next five years. And while the details of the scheme will be available in less than a month, companies will be able to apply starting April 1.
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Recently, Transport Minister Nitin Gadkari mentioned that Tesla has been offered incentives to start manufacturing in India and has ensured that the company is able to get the lowest production costs across the globe. Similarly, other EV makers like Triton, Ford, Volkswagen apart from India car makers like Mahindra and Mahindra and Tata motors have already been interested in making green vehicles.
That said, the lack of components, their pricing, lack of infrastructure, and high logistic costs are some of the challenges that have stifled the growth of electric vehicles in India. With this new scheme in place, the government not only wants to lay a red carpet for global companies but is also looking to create over 5.8 million new jobs and over $4billion of income as taxes.
In terms of automakers companies that can avail the benefit of this scheme, they need to have a minimum global revenue of $1.4 billion while the same for the component makers is $69 million. Further to qualify for the incentives these companies need to register a minimum of 8% of YoY growth.
There is no doubt that India’s electric vehicle plans are yet to take off. Indifferent policies and inefficient implementations by the central and state governments have not helped the cause at all. While the government is bullish about phasing out ICE vehicles, new policies that are created from scratch offering benefits to both the makers and the end-users are the only sensible way to go about it.
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