Growth of E-Vehicles Market
Electric mobility has resumed a relevant role on the agendas of most countries and automotive companies globally. On the one hand, governments are facing higher levels of pollution in various cities and especially megacities worldwide, as well as the urgent need to contribute to the fight against climate change.
Automotive companies have had to focus a good part of their recent efforts on producing more efficient vehicles in terms of emission of pollutants in their use, resulting in the electric vehicle issue's resurgence at the beginning of the 21st century. On the other hand, traditional automotive companies face previously non-existent competition from companies dedicated to producing 100% electric cars with a high level of technology.
India plans to inject $ 4.6 billion in incentives to companies setting up advanced battery manufacturing plants. It seeks to promote the use of electric vehicles and reduce its dependence on oil.
A proposal drafted by The National Institution for Transforming India Aayog, under the chairmanship of Indian PM Narendra Modi's, said India could cut its oil import bills by up to $ 40 billion by 2030 if electric vehicles were widely adopted. The proposal is likely to be reviewed by Modi's cabinet in the coming weeks, said a senior government official, who was not authorized to comment on the matter and declined to be named.
The think tank recommended incentives of $ 4.6 billion by 2030 for companies making advanced E- Vehicle starting with cash and infrastructure incentives of 9 billion rupees ($ 122 million) in the next financial year, which will then be increased annually.
India Boosts Electric Car Market will inject 4.6 billion dollars. Currently, the battery energy storage industry is in a very nascent stage in India, and investors are a bit concerned about investing in an emerging industry,
India plans to maintain its 5% import tax rate for certain types of batteries, including batteries for E- Vehicle, until 2022. Still, it will increase it to 15% after promoting local manufacturing, according to the document.
Although it wants to reduce its dependence on oil and cut pollution, India's efforts to promote electric vehicles have been hampered by a lack of investment in manufacturing and infrastructure, such as charging stations. Musk promises better batteries and a better price.
Only 3,400 electric cars were sold in the world's second-most populous nation in the last business year, compared to sales of 1.7 million conventional passenger cars.
The Possible Winners
The policy could benefit battery makers as well as automakers that have started building electric vehicles in India.
India has introduced stricter investment rules for Chinese companies. It has also slowed down the approval processes for some proposals after a border confrontation between the two countries in June.
The draft proposal said that annual internal demand for battery storage and the size of the market - currently less than 50-gigawatt hours and a value of just over $ 2 billion - could grow to 230-gigawatt hours, more than 14,000—million in 10 years.
The proposal estimates that it would cost companies about $ 6 billion over five years to set up manufacturing facilities with government subsidies. NITI Aayog has been the driving force behind several key Indian government policies, including the planned privatizations of a swath of state-owned companies.
India is one of the most relevant emerging markets for the automotive industry. E- Vehicle is called to play a leading role in this distant and exotic country—overview of the electric vehicle sector (battery-electric, hybrid, plug-in hybrid) in India. The electric vehicle market is still relatively small, accounting for less than 1% of the total vehicles sold in India. However, between 2018 and 2019, sales increased by 20% in volume and 30.5% in value. The low relative weight of the electric vehicle has to be qualified considering that India is the fourth largest vehicle market in the world, with 26.27 million units sold in 2019.
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