INCENTIVES FOR ELECTRIC VEHICLES

**Executive Summary** This document details the Indian government's initiatives to boost the Electric Vehicle (EV) industry. It presents the year-on-year growth in EV penetration from FY 2020-2025 and outlines three key schemes: the PLI-Auto, PLI-ACC, and PM E-DRIVE schemes. The PM E-DRIVE scheme, with a terminal date of 31.03.2028 (except for e-2Ws and e-3Ws, which is 31.03.2026), aims to incentivize the sale of various EV types and support infrastructure development. **Key Points / Main Content** * **EV Penetration Growth:** * Year-on-year growth data for registered ICE vehicles and EVs is provided for FY 2019-20 to FY 2024-25. * EV penetration increased from 0.71% in FY 2019-20 to 7.50% in FY 2024-25. * **Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry (PLI-Auto):** * Approved on 15.09.2021 with a budgetary outlay of ₹25,938 crore. * Aims to enhance manufacturing capabilities for Advanced Automotive Technology (AAT) products. * Offers financial incentives to boost domestic manufacturing of AAT products with a minimum of 50% Domestic Value Addition (DVA). * **Production Linked Incentive (PLI) Scheme for National Programme on Advanced Chemistry Cell (ACC) Battery Storage:** * Approved on 12.05.2021 with a budgetary outlay of ₹18,100 crore. * Promotes manufacturing of ACC in the country. * Envisages establishing a cumulative ACC battery manufacturing capacity of 50 GWh. * **PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme:** * Notified on 29.09.2024 with an outlay of ₹10,900 crore. * Valid from 01.04.2024 to 31.03.2028 (except for e-2Ws and e-3Ws, with a terminal date of 31.03.2026). * Aims to incentivize the sale of e-2W, e-3W, e-Ambulances, e-Trucks, and e-buses. * Supports development of charging infrastructure and upgrades to vehicle testing agencies. * Phased Manufacturing Programme (PMP) mandates domestic manufacturing of specified EV components. **Impact Analysis** **Automobile and Auto Component Manufacturers:** * **Impact:** The PLI-Auto scheme provides financial incentives for domestic manufacturing of advanced automotive technology products, influencing their investment and production strategies. * **Action Required:** Assess eligibility criteria and apply for the PLI-Auto scheme to receive financial incentives for manufacturing AAT products. **Battery Manufacturers:** * **Impact:** The PLI-ACC scheme aims to promote domestic ACC manufacturing, impacting battery manufacturers' investment and expansion plans. * **Action Required:** Evaluate the PLI-ACC scheme to establish or expand domestic ACC manufacturing capacity and take advantage of available financial incentives. **Electric Vehicle Manufacturers (e-2W, e-3W, e-Ambulances, e-Trucks, e-Buses):** * **Impact:** The PM E-DRIVE Scheme aims to incentivize the sale of various EVs, impacting their sales volume and market penetration. * **Action Required:** Assess eligibility criteria and leverage the PM E-DRIVE scheme to enhance sales through incentives. **Charging Infrastructure Providers:** * **Impact:** The PM E-DRIVE Scheme supports the development of charging infrastructure. * **Action Required:** Take advantage of the PM E-DRIVE scheme to develop charging infrastructure. **Vehicle Testing Agencies:** * **Impact:** The PM E-DRIVE Scheme supports upgrades to vehicle testing agencies. * **Action Required:** Leverage the PM E-DRIVE scheme to receive financial aid for upgrades to the vehicle testing agencies.

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