Lobby group Society of Manufacturers of Electric Vehicles (SMEV) plans to meet top government officials to seek clarity on the government’s position on electric vehicles, days after roads minister Nitin Gadkari said there was no need for such a policy.
The lobby group plans to meet NITI Aayog chief executive Amitabh Kant and heavy industries minister Anant Geete next week, said a senior executive of one of the members of SMEV.
Subsequently, SMEV plans to write to the Prime Minister’s Office (PMO) based on the feedback of the meetings with Kant and Geete, said two people aware of the matter.
SMEV represents companies such as Hero Electric, Okinawa Scooters, Mahindra and Mahindra and Tata Motors.
Gadkari, in a press conference on 16 February, said that the government will not formulate an electric vehicle policy and no further incentives will be accorded to the industry other than the existing ones.
This was a U-turn from the Union government’s erstwhile stance on sustainable mobility solutions.
“We have sought a meeting with Anant Geete and Amitabh Kant in the coming week to understand the government’s position on electric vehicles. Globally, a policy direction has been given by governments in order to make these vehicles affordable and sustainable for customers,” said a senior official at SMEV, requesting anonymity.
According to the industry body, the current subsidy on electric two-wheelers—up to Rs22,000—is not significant enough to lure buyers and the government should spend the entire amount allocated for giving subsidy over two or three years rather than five or six years in order to put electric vehicles and internal combustion engine-based vehicles on the same footing in terms of price.
“We need the second part of the FAME (subsidy) scheme to be implemented immediately from 2 April and if existing version of the FAME scheme continues then that would be meaningless. SMEV thinks that electric is the way forward and not hybrid and the government should focus on promoting electric two-wheelers and three-wheelers along with public transport buses in the next few years,” said the official mentioned above.
A day after Gadkari announced that there will be no specific policy framework on electric vehicles, the ministry of heavy industries issued a press release saying, “Department of Heavy Industry is working for formulating the National Automotive Policy for holistic development of automobile sector in India.”
Though the draft policy proposes to adopt a long-term road map for emission standards beyond BS 6 and harmonise the same with global standards, it does not make any mention of electric vehicles or any form of sustainable mobility solutions for the future.
According to a spokesperson of Ford Motor India Pvt. Ltd, manufacturers need to know the government’s mid-long term view to make critical future investment decisions. For example, until goods and services tax (GST) was introduced, hybrid vehicles were given importance and incentives, something that does not exist today.
“Taking electric vehicles from 0.1% to 100% is an arduous task, and require government commitment and clarity on the availability of charging infrastructure, investment and incentives guidelines and the role/stand of state governments on EVs v/s Hybrids & other technologies.” added a company spokesperson.
According to Mahindra Electric chief executive Mahesh Babu, the country’s largest electric vehicle maker is not expecting any additional policy push.
“We would, however, recommend that the current support under FAME and special tax structure for EVs continues for at least the next two years,” Babu said.
“NITI Aayog has also released reports on standards and policies around charging. Existing schemes are being implemented on ground and the resultant increase in EV adoption should start showing in the next one or two year time frame,” added Babu.
The government’s U-turn on electric vehicle policy is likely to benefit automobile manufacturers that have not developed electric vehicles.
“We wish that taxation policy is calibrated towards encouraging a technology-agnostic approach which would reduce pollution, reduce India’s oil import bills and encourage volume growth in the auto sector both of mass market cars and luxury vehicles. This will, in turn, lead to growth in employment where automobile sector is a big contributor,” said Shekar Viswanathan, vice-chairman and whole-time director, Toyota Kirloskar Motor Pvt. Ltd.