Piyush Goyal to EV industry: Move out of subsidy mindset

Union Commerce Minister Piyush Goyal said on Friday that the Electric Vehicle (EV) industry does not need subsidies and it has to move out of the subsidy mindset.

While speaking at the Green Bharat Summit, the minister said, "Subsidies are okay just to kickstart something to give the initial thrust. Any industry that expects to remain subsidised beyond initial few years can never be successful."

Goyal also said that we have to build competitive edge so that we can look at the long term success story in our industry.

Responding to a question on the call to remove subsidy for LED bulbs, Goyal said, "It was a stupid thing. Instead of making the product much more affordable, we were waiting for a future subsidy. There was no manufacturing. First file I signed was removing the subsidy much against the wishes of the bureaucracy."

"We have had subsidies like Fame 1, Fame 2, PLI scheme for auto industry to help them kickstart. But let's not make that permanent, let's make the industry self reliant," the minister added.

Commenting on fears of the automakers over the huge investments they have already made, Goyal said that some of the automakers are worried about the large investment they have done in the past. "I think they are being very myopic in their thinking. If I was in their shoes, I would see that the investment that would go dead is a very small component - just the ICE engine part."

"Better to forgo a small investment and try and capture a larger market share and contribute to the climate action," he said, adding that "if they continue to hog those ICE engines beyond a point, I suspect some of these companies will become obsolete in the future."

Speaking at the event, Bhavish Agarwal, founder of Ola Electric, aligned with the ministers' perspective, stating, "I agree with what ministers have said in terms if subsidies... I feel it should go away and consumers do not need subsidies now."

He added that the govt has done enough in terms of policy, subsidies and encouragement. "Now it is up to entrepreneurs to build on this", he said.