Why does the Future of Electric Vehicles in India Seems Bright?

The automobile sector in India is buzzing due to innovation, changing trends and new advancements recently. The future of electric vehicles in India which was a mere dream in the past seems to take a brighter turn and is gaining more attention than ever before by the growing number of masses. Yes, it is true that we can soon become a pollution-free country by transferring diesel/petrol cars into electric vehicle soon thereby paving way for a positive change.

Earlier, the manufacturing landscape of electric vehicle was limited to global automakers only. But now, we have numerous Indian automakers who are delving deep into the electric vehicle space and tapping the increasing potential of the vehicle market in the country.

The most interesting part of the Indian population is that it is evolving slowly and many consumers are now showing a willingness to switch to electric vehicles. A recent study revealed that by 2022, Indian consumers would consider buying electric vehicles which can likely trigger the future of the electric vehicle in India.

Of course, government policies and interventions must not be overlooked as it acts as a primary role in promoting electric vehicle growth in India. Many policies indeed are pushing electric vehicle adoption for years and many governmental initiatives have been introduced to enhance domestic capabilities across the electric vehicle value chain. To ensure that the future of electric vehicles in India is bright, many electric vehicles and battery prices are becoming affordable besides government has announced several tax deductions and subsidies to encourage people to buy more electric vehicles.

Electric vehicle in India market size and future projections

If India takes a stand to shift towards electric vehicles, it can gain on various fronts. Firstly, it will save valuable non-renewable energy resources. Secondly, renewable resources can be used abundantly along with skilled manpower in the manufacturing and technology sectors.

 Independent research made by CEEW Centre for Energy Finance found that the future of the electric vehicle in India is bright and India will see a $206 billion market opportunity by 2030 end provided the country maintains steady progress to meet such ambitious targets. To attain such projections, though an investment of around $180 billion might be required to manufacture and develop charging infrastructure.

Another research made by India Energy Storage Alliance found that the electric vehicle market in India will grow at a growth rate of 36% by 2026. The electric vehicle battery market is also expected to rise by 30% during the same time.

Regardless of such ambitious projections made, India stands at a nascent stage. Though many global players look at India as one of the largest untapped markets globally, particularly in a two-wheeler segment. You will be amazed to know that India allows 100% foreign direct investment under this sector in automatic route. In response to such an opportunity, market players such as OLA Electric Mobility Pvt, Mahindra Electrics and Ether Energy are growing rapidly through market presence. Moreover, many states like Tamil Nadu and Karnataka are investing in eco-friendly projects and policies to build the necessary infrastructure for electric vehicles.

More recently, an American electric vehicle company, Tesla Inc. marked its entry in India by incorporating its subsidiary in Bengaluru named under Tesla India Motors and Energy Pvt Ltd. In February 2021, India’s first intelligence electric vehicle manufacturer named Ather energy moved its $86.5 million factories from Bengaluru to Hosur in Tamil Nadu. The factory is said to deliver around 0.11 million two-wheelers annually.

In March 2021, OLA Electric, a subsidiary of unicorn Indian ride-hailing start-up announced that it will set world’s largest electric scooter manufacturing plant in Hosur over the next few weeks costing around $330 million. The factory aims at producing 2 million units every year. By 2022, OLA Electric expects to scale up its production to produce 10 million electric scooters which are equivalent to 15% of e-scooters worldwide.

Again, one of India’s leading engineering, construction and procurement company Sterling and Wilson Pvt Ltd has announced this year that they will enter into the electric mobility segment very soon. The firm signed a 50-50 joint venture with Enel X to create and launch an innovative electric vehicle charging infrastructure in India.

Innovation and R&D Triggering Bright Future of Electric Vehicle in India

While analysing electric vehicle space, I found that around 1.56 lakh electric vehicles were sold in India in 2019 in which 3,400 were electric cars, 600 were electric buses and 1.52 lakh were electric scooters. This made me clear about the potential future of electric vehicles in India, especially for the two-wheelers segment.

Looking ahead, we can say that India aspires to reach its 2030 vision by promoting 100% electric vehicles. Surely, such an ambitious vision cannot be fulfilled by government support, technology, reducing distressing pollution levels and cost of production. Such accelerating steps to enable government vision can surely trigger collective fuel and accelerate the transition to electric vehicle speedily. Nonetheless, we have a long way to go.

Let’s not overlook the commendable progress made by India in mobilising the electric market although the transition is taking place steadily. What is more important here is the correct path and that a positive shift has already started slowly after the introduction and interest shown by the world’s largest market players in the electric vehicle segment. Moreover, innovations in the electric vehicle market are constantly taking new shape and we can expect more subtle policies in future that are favourable for buying and selling electric vehicles as compared to conventional vehicles.

Policy measures for bright future of electric vehicles in India

Various fiscal and non-fiscal policies have been implemented by Indian lawmakers to facilitate the adoption of electric vehicles. Some of them are:

  1. National Electric Mobility Mission Plan 2020: the NEMMP plan was launched by the Department of Heavy Industry in 2013 to ensure faster manufacturing and adoption of electric vehicle in India. In FAME Phase I, the manufacturing of electric and hybrid vehicle technology was promoted in 2015. Some of the key areas focused in Phase I includes technology platform, demand creation, charging infrastructure and pilot projects. Mainly, incentives were announced by the government in this phase along with reduced prices of raw materials. The Phase II of the project was launched in 2019 that outlaid $1.36 billion incentives for the purchase and supporting charging infrastructure development.
  2. Department of Science and technology has proposed to launch a grand establishment to develop Indian Standards for future Electric Vehicle Charging Infrastructure.
  3. Ministry of Power clarified that electric vehicle charging must be considered as a service. This means, operating electric vehicle charging stations will not need any kind of license. Besides, a policy has been introduced for charging infrastructure to ensure faster adoption of electric vehicle in India.
  4. The ministry of road transport and highways has too declared about issuing green licence plates for both commercial and private battery-operated vehicles. The ministry notified that every battery-operated, methanol-powered and ethanol-powered transport vehicles can be exempted from the necessary commercial permits.
  5. The CEO of Niti Aayog along with cabinet ministers have approved the National Mission on Transformative Mobility and Battery Storage. The mission aims at creating a Phased Manufacturing Program for 5 years till 2024 that will support large-scale set-up. The mission also supports large-scale battery production and Giga manufacturing plants in India besides localizing production across the electric vehicle value and supply chain.

Future of electric vehicles in India and adoption campaigns

The reason behind the core of e-mobility is the electric vehicle itself. We have seen that many cuties such as Kolkata and Delhi lead the mainstream e-mobility. The cities not just promote e-rickshaw but also lessens electric vehicle costs by operational efficiencies. Currently, Delhi has more than 1 lakh e-rickshaw and following next is Kolkata with around 90,000. Such developments are encouraging electric vehicles sales for personal use also.

One of the newly launched campaigns in Delhi is ‘Switch Delhi’ which encourages electric vehicle industry progress. The campaign aims at the adoption of electric vehicle. Due to the success of the campaign, some leading two-wheeler firms have reported that they will launch new electric vehicle models in Delhi very soon.

Another campaign was announced by the Transport Minister of Delhi that increased electric two-wheelers vehicle registration in the nation’s capital. The eight-week campaign promoted driving awareness and benefits of switching to electric vehicle to make more people opt for this mode for daily transportation.

Battery swapping stations enhancing future of electric vehicles in India

The rise of electric vehicle sales demands high-end battery charging stations also to maintain vehicle speed and distance. The battery charging process usually takes a couple of hours that can be a huge problem, particularly for long route travellers.

This is the reason many last-mile delivery companies have established new battery swapping stations that decrease turnaround time along with the charging period. With battery swappingstations, the vehicle riders can easily swap a drained battery with a fully charged one within a few minutes.

The growth of such stations along withquickcharging stations is increasing the spread of electric vehicle usage. The solution has been adopted by many electric vehicle producing companies also to ensure that their customers get a convenient solution regarding battery charging needs.

Overall, the growing awareness regarding environmental conservation, cost-effective solution and convenience of using an electric vehicle is attracting Indians immensely. Thus, it can be said that the future of the electric vehicle in India is bright and India is going to become positively electric.