What The Indian EV Sector Expects From Union Budget 2024

What The Indian EV Sector Expects From Union Budget 2024

With a day left for the Union Budget, the Electric Vehicle (EV) and the battery manufacturers, battery recycling companies have pinned their hopes on the budget. The industry now expects attention to the sector to weed out some of the major hurdles in the sector. 

Following are the expectations of the industry from the budget–

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“We anticipate an expansion of the FAME II scheme with increased subsidies, especially for commercial EV fleets including two wheelers. It is crucial to incentivize domestic manufacturing of EV components like batteries and electronics to reduce import dependency and bolster supply chains. Lowering GST on EVs and components would boost affordability, while enhanced tax benefits for EV buyers and infrastructure investors will spur adaptation to the sector.”

Tushar Choudhary, Founder & CEO, Motovolt Mobility

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“Recently, the Union Minister of Heavy Industry indicated that the FAME III norms are unlikely to be announced in the upcoming budget. Nevertheless, we remain hopeful that these norms are still under consideration and that some provisions might be included. Commercial vehicles are one of the most polluting segments of road transportation and account for 65-70% of total vehicular pollution. Decarbonizing this segment should be a priority for the government and a policy to address this should be implemented soon. Effective government intervention is essential at this stage to achieve India’s goal of having 30% of vehicle sales be electric by 2030.”

Inderveer Singh, CEO and Founder, EVage
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“To meet the nation’s goal of becoming net zero by 2070, accelerating EV adoption is crucial. Extending the FAME subsidy will be a significant step in this direction, helping to boost EV adoption across the country. Additionally, a dedicated budget for Li-ion battery manufacturing, semiconductors, and energy storage systems is essential for developing a robust EV infrastructure. Reducing GST on Li-ion batteries and introducing PLI-based incentives can further stimulate industry growth. Moreover, increased allowances for R&D will foster innovation and open new opportunities for the sector.”

Deepak Pahwa, Director, Bry-Air

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“We need a robust government policy that can incentivize both manufacturers, individuals, as well as the larger ecosystem. This includes subsidies, tax benefits, lower GST rates for EVs and making EVs more accessible to the larger public. Equally important is the development of a widespread and reliable charging infrastructure. We urge the government to invest in expanding this network, particularly in urban areas and also along the highways. This will address the range anxiety issue that many potential EV buyers face. Additionally, better financing options are crucial to support consumers in making the switch to electric vehicles.”

Samarth Kholkar, CEO & Co-Founder, Blive

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“While lauding previous initiatives like FAME II and EMPS, expectations are high for a new subsidy scheme akin to FAME II, with equivalent value but more stringent eligibility criteria for vehicle types and localization requirements. The subsidy scope is anticipated to expand, covering larger vehicle segments like trucks in addition to passenger vehicles, two-wheelers, and three-wheelers. A significant emphasis on Research & Development (R&D) and domestic manufacturing capabilities for EVs and batteries is expected, with the Production-Linked Incentive (PLI) scheme receiving further support. Revisiting EV’s priority lending sector status and reinforcing efforts are also on the cards.”

Maxson Lewis, Founder & CEO, Magenta Mobility