The growing trend towards electric vehicles and advances in technology, AI, and the Internet of Things has led to the development of connected and autonomous vehicles, of which MG Motor was a pioneer in India. The adoption of connected vehicles and EVs is showing positive signs, and according to the Road Transport and Highways Minister, over 18 Lakh electric vehicles have been registered in India, a number that is expected to triple to 50 Lakh units by 2030. To further increase the adoption of EVs as a regular mode of transportation, there is a need for consistent economic incentives and government support through regulations and budget allocation in the upcoming Union Finance Budget.
Electric vehicle companies have expressed their expectations for the upcoming budget announcement by the Hon’ble Finance Minister:-
Ketan Mehta, Founder & CEO, HOP Electric Mobility, lists his thoughts –
- Streamline the PLI scheme, thus bringing clarity in the provisions and related benefits
- FAME II scheme to be defined with more clarity and inclusive to ensure innovation in product development and enhance EV adoption
- Level playing field between established players and start-ups in the segment
- The applicable GST levied needs to be reformed and rationalised – anticipating a curtailment in the current GST on lithium-ion battery packs and cells from 18% to 5%.
- Further, boost in the charging infrastructure development – PPP model could be looked at more comprehensively for rapid deployment
- Promote the universal battery charging and swapping infrastructure for ease of use
Rajat Verma, CEO & Founder, Lohum Cleantech :says,
The Prime Minister has rightly acknowledged that India needs to develop self-reliance in energy security, and called for a #MakeinIndia circular economy. A circular economy of battery raw materials will boost India’s energy security and uplift domestic manufacturing. Government support can greatly accelerate this shift and magnify its rewards, which we hope to see in the budget this year.
Hyder Khan, CEO Godawari Electric Motors, said
“The government has been supportive of the EV industries with the constant policy push in the last few years. As the ambit of EVs expands, we hope that the upcoming Union Budget considers increasing the FAME-II subsidy for the e-auto (L5M) segment to Rs. 15000 per kWh or 40% of the ex-showroom cost, whichever is lower in line with EV two-wheelers. The e-auto segment has undergone rapid electrification transformation and will prove to be a major source of enhancing last- mile connectivity. This will lead to improving affordability and accelerate EV adoption further in the country.”
Mr. Amit Gupta, Head- Energy Infrastructure Solutions, Delta Electronics India, explained
Delta firmly believes that the Union Budget 2023–24, which will be unveiled at a pivotal time of geopolitical unpredictability, high inflation, and sluggish global economic growth, will aid the EV industry in moving forward and accelerating the adoption of EVs.
E-mobility will advance in India as a result of newly announced government measures to improve the infrastructure for charging. Grid connectivity will be improved, and installing infrastructure for public charging will be made simpler. However, the part needs a bigger push. The industry needs more assistance to encourage private enterprises to build charging infrastructure, which will facilitate the widespread adoption of EVs.
Infrastructure for charging requires capital-intensive design and installation costs. The sector’s top aim is to keep capital costs as low as feasible. The proper course of action for making it easier to install charging infrastructure is to facilitate grid connectivity, but it is crucial for the sector that the government also subsidizes electrical connections and fixed load fees for EV charging point operators.
The government has encouraged the use of charging stations by setting the GST at 5% on the sale of charging stations, but the GST rate is 18% when using the infrastructure. Given that many people utilize these charging stations and do not qualify for an input tax credit, the government must reduce this GST to 0%, just like it does with the sale of energy.
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Making low-cost renewable energy available: The transition from expensive fossil fuel-based power generation to affordable renewable energy will aid in making EV transportation really viable. By supporting strategies like open access to solar energy, it will be possible to increase the supply of RE electricity while lowering operational costs.
Revenue generation: Installing EV charging infrastructure requires significant investment. The industry can be made more profitable in a number of ways, including by enhancing promotion, introducing smart charging services, and investigating network interoperability to lower latency, increase revenues, and lower expenses.
Make charging stations a part of green building: India is putting an emphasis on smart cities and green construction. The proper charging infrastructure is crucial for both new green real estate projects and existing real estate including industrial, commercial, and residential complexes. This will promote sectoral growth and open up opportunities for the industry to generate income.