Veer Singh, CEO, Lord’s Automative Pvt Ltd

India’s electric vehicle (EV) sector is on the brink of a transformation. Presently, EVs account for only around 2-4% of total vehicle sales, but in 2030 the prognostics mention it could witness a drastic increase in sales in terms of numbers. 2025 promises to be a watershed year between the changing nostalgic attitudes of policy-making, technology improvements and more shifts in consumer attitude and behaviour.

Policy Momentum and Initiatives by Government

The Indian government has shifted its focus on drafting policies that facilitate the immediate adoption of EV as the government aims for 30% EV penetration by 2030 and is actively promoting a self-reliant EV ecosystem. These policies include the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) initiative (2015), which focused on providing subsidy schemes for two-wheeler, three-wheeler and bus electric vehicles. The FAME II start-up scheme focused on putting public and shared transport on electric mode under its aegis starting from April 2019. Last March-onwards, the government reduced import duty on EVs above $35,000 from 100% to 15% in favour of local investment for further encouragement.

To support these initiatives, the production linked incentive (PLI), launched in September 2021, will further promote local manufacturing of emerging automotive technologies products including components and batteries for EVs. Altogether, those policy initiatives create a conducive environment for the penetration of electric vehicles into India.