Indian Government working on new mobility policy

Published On: 11 May 2017
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NITI Aayog draft policy aimed at ensuring all vehicles are electric by 2032.

New policy for shift to all-elecric vehicles

With growing environmental concerns, India is planning a massive shift to electric Vehicles (EVs) over the next decade and a half. The National Institution for Transforming India (NITI Aayog), the premier policy think-tank of the government of India, has recommended lowering of taxes and interest rates for loans on EVs.

The move would involve capping sales of cars you see around you every day. This move is a dramatic shift in policy in India, one of the world's fastest growing auto markets. According to a Reuters report, a 90-page draft report has suggested that the government should open a battery plant by the end of 2018 and use tax revenues from the sale of petrol and diesel-engined vehicles to set up charging stations for EVs. The NITI Aayog's recommendations aim to discourage fossil fuels, a strategy similar to China, also a massive polluter, which is aggressively driving sales of plug-in EVs.

The NITI Aayog draft policy’s goal is to electrify all vehicles in the country by 2032. The report marks a sharp shift from the current policy that incentivises both hybrids and EVs. The ‘Transformative Mobility Solutions for India’ report, co-produced with US consultancy Rocky Mountain Institute, comes a little over two months after the NITI Aayog held a high-level workshop on advancing passenger mobility and transportation in New Delhi.

India, the third-largest consumer of fossil fuels in the world and 80 percent dependent on imports to its domestic demand, is looking to slash its crude oil import by half by 2030.

Officials acknowledge that they will face challenges on the way ahead. "If we accelerate EV growth, it will be a disruption for the auto sector and would require investment, but if we're not able to adapt quickly, we risk being net importers of batteries," a government source told Reuters. "There has been a resistance from car makers."