A Glimpse into Budget 2024: What Will Be the Future of EV in India?

 

As India’s EV industry accelerates towards a cleaner and sustainable future, the anticipation surrounding Budget 2024 is palpable. Industry stakeholders eagerly await announcements that could steer the trajectory of the future of EV in India.

In this blog, we dissect key developments, expectations, and the strategic roadmap for India’s burgeoning EV landscape.

2024 EV Trends — Future of EV in India

Current Dynamics and Growth

The rapidly growing electric vehicle industry in India reached a pivotal moment in 2023, selling a remarkable 1.5 million units, marking a robust 46% YoY growth. This surge not only signifies a burgeoning market but also lays the groundwork for discussions on the future of EV in India.

Budget 2024 Expectations — FAME and GST

As the Budget date looms, industry insiders are hopeful for a reduction in the goods and services tax (GST) rate on EV components and an extension of the Faster Adoption and Manufacturing of Electric Vehicles (FAME) subsidy scheme — pivotal aspects influencing the future of EV in India. Introduced in 2019, the FAME 2 scheme aimed to support 10 lakh electric two wheelers, 5 lakh electric three wheelers, 55,000 electric passenger cars, and 7,000 electric buses. The question now is: how will the Budget 2024 shape the continued evolution of the future of EV in India?

Industry Voices and Vision for the Future

Amid these expectations, industry leaders share their perspectives on the future of EV in India. Naveen Munjal, founder and managing director of Hero Electric, emphasizes the need for “long term policy measures that promote EV adoption” such as reduced GST rates and the extension of FAME-II subsidies. Pratik Kamdar, CEO & Co-Founder of Neuron Energy, echoes this sentiment, advocating for lower tax rates to make EVs more affordable. These voices underscore the significance of government support in shaping the future of EV in India.

Infrastructure Development

The vision for the future of EV in India goes beyond policy changes. Lalit Singh, CEO of TelioEV, stresses the importance of robust EV charging infrastructure, especially in Tier II and Tier III cities. This emphasizes the interplay between infrastructure development and the future of EV in India.

Industry Expectations and Transformative Changes

Industry players like Akihiro Ueda, CEO of Terra Motors, and Nehal Gupta, Founder of AMU, express their expectations for the Budget, viewing it as more than a financial statement. Akihiro Ueda hopes for initiatives that boost manufacturing and infrastructure development — vital components of the future of EV in India. Nehal Gupta anticipates transformative change in the insurance sector and sees opportunities in the future of EV in India through subsidies, tax benefits, and innovative financing solutions.

Government Incentives and Policies Driving EV Adoption

The future of EV in India is intricately tied to government incentives and policies. The continuation of incentives for both manufacturers and consumers, along with expected developments in increased support and infrastructure, will play a pivotal role in encouraging a wider transition to electric vehicles.

Expected Developments & Increased Support

Key points to look out for in the future of EV in India include increased government support through boosted subsidies for EV manufacturers. This approach aligns with the vision of making EVs more affordable, ensuring a holistic transition to cleaner and greener transportation options. Additionally, a strategic plan for infrastructure development, including subsidies for charging stations and advancements in fast-charging technology, will build confidence among potential EV buyers.

Conclusion

As the Budget 2024 unfolds, it holds the promise of unveiling the future of EV in India. The interwoven elements of policy support, infrastructure development, and transformative changes in the industry set the stage for a sustainable and eco-friendly era of transportation. With every announcement, India takes a step closer to redefining its automotive landscape, bringing the future of EV in India into sharper focus. The journey towards cleaner mobility is not just a fiscal matter but a visionary stride towards a greener tomorrow.

FAQs

1. Is electric vehicles the future in India?

70% of primary Indian car buyers express readiness to contemplate an electric vehicle for their next purchase, surpassing the global average of 52%, which stands at an all-time high.

2. What is the future of EV & EV charging stations in India?

The Indian government has set a target for electric vehicles (EVs) to constitute 30% of new private vehicle registrations, totaling 80 million EVs, by the year 2030. To facilitate this significant surge in EV adoption, India will require a total of 3.9 million public and semi-public charging stations, maintaining a ratio of one station per every 20 vehicles.

3. Is EV a good investment in India?

Indeed, the prospects for electric vehicle stocks (EV shares in India) appear promising. With a sizable population and an expanding middle class, there exists a substantial potential for increased demand for EVs in the country. Investors ought to grasp the growth opportunities as well as the challenges faced by companies in the electric vehicle sector.

4. Who will dominate the EV market in India?

As of 2024, Tata Motors held a commanding position in the domestic EV market, capturing a 72% share, followed by MG Motors at 10.8% and Mahindra at 9%. The leading models driving sales were Tata Motors’ Tiago, Nexon, and Tigor, along with MG Motors’ ZS and Mahindra’s XUV400.

5. Do EV cars have a future?

The government has established a goal of attaining a 30% electric vehicle replacement rate by 2030, and numerous manufacturers have disclosed their intentions to introduce electric vehicles in the upcoming years. Another encouraging trend is the growing emphasis on renewable energy in India.

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