Expectations From The Upcoming Budget for EV Ecosystem in India

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Expectations From The Upcoming Budget for EV Ecosystem in India

What the Indian EV Ecosystem wants now Is an “Integrated and Inclusive Approach for Green Mobility”. The industry realizes that incentives either demand or supply are not sustainable in the long run and it’s always the integrated and inclusive approach that takes it forward.

What does that mean and what all it encompasses:

The following points are already tick marked in the EV Ecosystem.

  • 1. Penetration of 2 wheelers – picking up
  • 2. End consumers already enjoying the lower running costs
  • 3. Last mile deliveries for E commerce have already started and are tending to raise and scale
  • 4. Shared mobility through electric buses and aggregation of demand by CESL is already showing sings of success

While the market overall gains traction, acceptability; the affordability at least among passenger Electric vehicles is still unachieved.

And such huge disparity can never be continuously addressed through incentives but through measures that would boost the volumes of components. And this is possible through cross linkages with in various automotive touch points.

  1. The vehicle scrapping policy is all set and ready to be established and deployed among various states – Budget to mention/ talk about enhanced and lucrative incentives that allows the vehicle owners to opt for an electric vehicle in the place of an ICE vehicle through exchange.
  2. Along with this, the budget also must encourage the circular economy and enable the ecosystem to set up the recycling of the scrape and help find their place once again in the manufacturing of the vehicles.
  3. At a juncture like this, budget might also encourage the deeper value chain of EV Ecosystem – such as after life of batteries, their safe disposal and urban mining (extracting minerals from batteries of laptops, phones, inverters ect & put them to reuse) Specific business to soon come into play which will help industry curtain down its dependency on fresh new raw materials but consume these recycled inputs.
  4. While the battery and swapping policy is already in place, the budget must focus up on bringing standardization at least in terms of the structure, lay out and other peripherals and connects of these battery packs to ensure, mass production with less variations.
  5. Focus on Research, Development and Training – The biggest threat to the growing industry is non availability of relevant talent pool and research and labs that are working on advanced battery chemistries and alternate fuels.
  6. While the bigger players can afford to set up their own labs and training institutes to hone the talent, start-ups and MSMEs may not find it affordable to run and build their own and hence the budget must encourage the Learning & Training and testing Labs.
  7. Decarbonized Economy as a whole: While the budgets and policies so far addressed the battery to wheel efficiency and supply chain; its important now to address the value chain that goes into making the electric vehicle.
  8. Not just into the electric vehicle manufacturing, but adoption of hydrogen and specifically green hydrogens needs to be heavily pushed and encouraged into manufacturing industry. This will further help achieve the cause of net zero emission country by 2070.
  9. Ex: There can be further push and encouragement to ecosystem players who would use green hydrogen / renewable or other non fossil fuels in making of the vehicles. .
  10. The carbon credits can further be brought into context and be used as manufacturing incentive of players who are producing less carbon emissions.
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While the ask might continue further; its important that budget addresses the non EV and non automotive segments, especially from the manufacturing perspective to encourage and push sustainable way of manufacturing and living.

This will further enhance the demand and supply of BOM that gets into manufacturing of Electric vehicles and by the shear increase of such volumes, the over all cost of electric vehicle would definitely come down and in cases, it might even fall below the cost of it’s counter part ICE Vehicle.

By Rajeev YSR

Chief Mentor – EV Masterclass | MIT Sloan | IIT Madras I 40 Under 40 | Govt Advisor – Policy & Investment Promotion | Global Emerging Leader & National Youth Icon’22 awardee| Angel Investor | Startup Mentor | Faculty @ISB D-Labs | EV Expert | Ex COO – Avaan, Gati, Bosch, M&M, TVS

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