Modi government plans policy overhaul to push electric vehicles

A plug is seen coming from the Chevrolet Volt electric car during the North American International Auto Show in Detroit, Michigan January 13, 2009. REUTERS/Mark Blinch (UNITED STATES) - RTR23CT6

In an Elon Musk-like move, the Narendra Modi-led government plans switch introduce a programme meant to switch two- and three-wheelers and buses to battery power by 2030. The plan relies upon keeping off subsidies and depending on a battery leasing strategy. The scheme is likely to be rolled out in a couple of months and offers limited tax breaks for auto companies, The Economic Times reported Tuesday.

The proposed strategy, which encompasses selling vehicles without batteries, is in contrast to vehicle policies in the West and in countries like Japan and China. Prices may come down by 70 percent as part of the scheme which relies upon battery leasing. When leased batteries run out of charge, motorists can swap them at recharge stations, the report stated.

While Indian auto companies have shown interest toward the move which will be led by IIT Madras professor Ashok Jhunjhunwala, global companies favour other forms of hybrid technology, according to a senior government official mentioned in the report.

The scheme is in the final stages of drafting and proposes to bring private vehicles under its umbrella in the last lap of its implementation. The model is only meant for non-air-conditioned vehicles. According to the report, NITI Aayog is drawing up the fine print of the plan in which the road transport, power, petroleum and heavy industries are involved.

The Centre is expecting a cost benefit by switching to electrics. Let say, after paying up for battery and vehicle, a sedan which runs on internal combustion engine costs Rs 7 per km to run. In contrast, an equivalent electric vehicle will cost only Rs 1 per km to run.