The Centre expects a good response from many automobile companies on its electric vehicle (EV) policy, which was released in March to attract global p
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Months after announcing plans to tweak India’s existing electric vehicle (EV) policy to attract more global players, the Centre is gearing up to issue draft guidelines on the upcoming revised policy for EV makers. The Ministry of Heavy Industries is expected to meet stakeholders within a couple of months to give the EV policy its final shape. In March, the Centre had said it will revise the existing EV policy which will incentivise foreign electric vehicle manufacturers for setting up facilities in India and using local resources or commit a minimum investment plan. The move is seen to attract global EV giants like Tesla to enter the Indian EV market.
The upcoming EV policy will revolve around the new Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) announced by the Centre on March 15 this year. It proposes tax cuts on imported electric cars from manufacturers that commit to invest ₹4,150 crore over a period of five years which should also include plans to set up local manufacturing plants in the country. VinFast, an EV startup based out of Vietnam, was one of the first foreign manufacturer to announce its investment plans and set up facility in Tamil Nadu, which is currently under construction.
The Centre had held the first round of meeting with EV makers in April this year which was also attended by representatives from Tesla. The next meeting, according to the government, will be held before July-end. The Centre will invite applications from EV makers to claim benefit under the new EV policy. However, previous investments made by such manufacturers will not be considered. VinFast was also communicated that its older venture will not count and it will have to apply afresh. A senior official at the Ministry of Heavy Industries said, “They said they will stop more investments in that case until the scheme comes out.”
The Centre is expected to open the window for EV makers to apply under the new EV policy from July 31 or later. They will have a period of 120 days or more to file their applications which will be evaluated by the Centre before approving them.
The move is seen as yet another opportunity for foreign carmakers like Tesla to rethink its India launch strategy. The US-based EV maker had been trying to lobby for a lower import tax for the past couple of years to enter the Indian market. Talks have been held between the company and the Centre at different levels to iron out the issues. Tesla CEO Elon Musk had also announced his intentions to visit India this year and meet Prime Minister Narendra Modi to take the talks forward. However, he deferred the meeting at the last moment.
Also Read : India won’t make further changes in its EV policy to suit a specific company, says Amitabh Kant
Tata Motors, the leading EV manufacturer in India, had earlier urged the Centre not to reduce import tax on electric cars and offer a level-playing field for local manufacturers. Currently, the Centre charges 70 to 100 per cent import tax on electric cars imported to India. The import duty on electric vehicles by these carmakers will be reduced to 15 per cent provided their prices do not exceed $35,000 (roughly converted to ₹29 lakh) under the new EV policy.
First Published Date: 21 May 2024, 11:04 AM IST