Parliament Question: Incentives for Electric Vehicles

**Executive Summary** This document is a response from the Minister of State for Heavy Industries to questions regarding incentives for Electric Vehicles (EVs). It outlines the year-on-year growth in EV penetration from FY2020-2025 and details the schemes implemented to strengthen the domestic manufacturing supply chain. The document also indicates that the data on EV component manufacturing in the country is not centrally maintained and that there is no current proposal to withdraw EV incentives. **Key Points / Main Content** * **EV Penetration Growth (FY2020-2025):** * Provides the number of registered ICE Vehicles and EVs, as well as EV penetration percentage, from FY2019-2020 to FY2024-2025. * EV penetration has increased from 0.71% in FY2019-20 to 7.50% in FY2024-2025. * **Schemes for Strengthening Domestic Manufacturing:** * **PLI-Auto Scheme:** Approved on 15.09.2021 with a budgetary outlay of ₹25,938 crore to enhance manufacturing capabilities for Advanced Automotive Technology (AAT) products. Requires a minimum of 50% Domestic Value Addition (DVA). * **PLI-ACC Battery Storage Scheme:** Approved on 12.05.2021 with a budgetary outlay of ₹18,100 crore to promote manufacturing of ACC batteries and establish a cumulative ACC battery manufacturing capacity of 50 GWh. * **PM E-DRIVE Scheme:** Notified on 29.09.2024, with an outlay of ₹10,900 crore. Incentivizes the sale of e-2W, e-3W, e-Ambulances, e-Trucks, and e-buses, supports charging infrastructure development, and mandates domestic manufacturing of specified EV components. Valid until 31.03.2028 except for e-2Ws and e-3Ws, for which the terminal date is 31.03.2026. * **Tariff Impact Assessment:** * The Ministry of Heavy Industries (MHI) has not carried out any assessment on the impact of recent tariffs on the domestic EV manufacturing ecosystem. * **Domestic Manufacturing of EV Components:** * Data on the percentage of EV components manufactured in the country is not centrally maintained. * **Withdrawal of EV Incentives:** * There is no proposal under consideration by the Ministry of Heavy Industries to withdraw incentives for EVs. **Impact Analysis** **Automotive Manufacturers** * **Impact:** Encouraged to manufacture AAT products and ACC batteries domestically through financial incentives under the PLI schemes. Subject to Phased Manufacturing Programme (PMP) mandating domestic manufacturing. * **Action Required:** Apply for PLI schemes, invest in domestic manufacturing, and comply with DVA requirements. **Electric Vehicle Manufacturers** * **Impact:** Incentivized to sell EVs through the PM E-DRIVE scheme and encouraged to domestically manufacture EV components. * **Action Required:** Participate in the PM E-DRIVE scheme and align manufacturing processes with the PMP guidelines. **Component Manufacturers** * **Impact:** Increased opportunities to supply components for EV manufacturing due to domestic manufacturing mandates. * **Action Required:** Invest in manufacturing capabilities for EV components to meet the growing demand. **Consumers** * **Impact:** Potentially benefit from increased availability and affordability of EVs due to incentives and domestic manufacturing. * **Action Required:** Stay informed about available incentives and EV models to make informed purchasing decisions.

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