With the Union Budget 2024 expected to be announced in less than 24 hours, stakeholders in the EV industry are hopeful that the new budget will provide the much-needed boost to accelerate India’s transition to electric mobility.
From well-established automakers to fledgling EV startups, the entire ecosystem is keen on the government’s long-term roadmap on EV adoption, promoting domestic value addition, supply chain challenges, R&D, infrastructure development, as well as export incentives, which will also be an enabler for the industry to innovate and expand its global footprint.
While many of them anticipate targeted incentives like FAME 3.0, some are looking for more support for local battery production and innovation, which are critical for the sustainability and cost-effectiveness of EVs. Some of the other anticipated measures include a comprehensive Battery Swapping Policy, proposals to incentivize local production of EV components, all aimed at fortifying India’s EV ecosystem.
Society of Manufacturers of Electric Vehicles (SMEV) opines that in addition to encouraging personal EV ownership, specific measures to boost EV deployment in commercial use cases like shared mobility, taxis, and last-mile delivery would be beneficial.
R.K. Misra, President, SMEV noted that it will be essential to correct the GST disparity by reducing the GST on battery packs from 18 percent to 5 percent and lowering the applicable GST rates for public charging to encourage the rapid expansion of EV charging and swapping infrastructure.
In the upcoming Budget, the EV industry seeks a level playing field for all technologies, emphasizing the need to address disparities in GST and subsidies, particularly for swappable batteries.
"Simplifying and enhancing financing options for EV purchases will also play a crucial role in boosting adoption rates. Furthermore, we hope for policies that support the development of a robust charging infrastructure, including incentives for renewable energy-powered charging stations, to ensure seamless and eco-friendly commutes, stated Chakravarthi C. Managing Director, Quantum Energy.
During the Interim Budget 2024, the Electric Vehicle (EV) ecosystem was broadened and deepened through the expansion of manufacturing and charging infrastructure. Furthermore, electric buses will receive support through price safety mechanism.
Furthermore, customs duty exemption was extended to the import of capital goods and machinery needed for manufacturing of lithium-ion cells for batteries used in electric vehicles. As part of the government’s green and clean mobility strategy, funds have also been allocated for the replacement of government vehicles.
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