The Government of India, under the leadership of Hon’ble Prime Minister Shri Narendra Modi, has officially notified the guidelines for the “Scheme to Promote Manufacturing of Electric Passenger Cars in India” (SPMEPCI). This significant step is aimed at accelerating domestic electric vehicle (EV) manufacturing, supporting the nation’s net-zero ambitions by 2070, and making India a global manufacturing and innovation hub for sustainable mobility.
The Ministry of Heavy Industries (MHI) released the detailed scheme guidelines following the initial notification dated 15 March 2024. On the same day, the Department of Revenue, Ministry of Finance, issued a notification outlining customs duty concessions aligned with the scheme provisions. The Notice Inviting Applications (NIA) is expected to be issued soon, after which prospective applicants can submit applications online.
Key highlights of the scheme include:
• Reduced Customs Duty: Approved applicants can import completely built electric four-wheelers (e-4Ws) with a minimum CIF value of USD 35,000 at a reduced customs duty of 15% for five years from the date of approval.
• Annual Import Cap: A maximum of 8,000 e-4Ws can be imported annually at the concessional rate. Unused quotas may be carried forward.
• Duty Foregone Limit: The total customs duty foregone will be capped at the lower of Rs. 6,484 crore or the actual investment made by the applicant.
• Minimum Investment Commitment: Rs. 4,150 crore (approximately USD 500 million) within a three-year window from the application approval date.
• Commencement of Operations: Approved applicants must establish manufacturing operations for e-4Ws within three years of approval.
• Domestic Value Addition (DVA): Applicants must achieve a minimum DVA of 25% within three years and 50% within five years. DVA will be assessed using the SOP under the PLI Auto Scheme and certified by MHI-approved testing agencies.
• Eligible Investment Categories: Costs towards new plant and machinery, R&D, and associated utilities will be considered. Land costs are excluded, while investment in main plant buildings is capped at 10% of the total committed investment. Up to 5% of investment in charging infrastructure is allowed.
• Bank Guarantee: Applicants must furnish a bank guarantee from a scheduled commercial bank in India, equal to the higher of the total duty foregone or Rs. 4,150 crore, valid throughout the scheme period.
• Application Process: The NIA window will remain open for a minimum of 120 days, with applications accepted until 15 March 2026. A non-refundable application fee of Rs. 5,00,000 will be applicable.
Eligibility criteria include:
• Global Group Revenue (automotive manufacturing): Minimum Rs. 10,000 crore, based on the latest audited financials.
• Global Fixed Asset Investment (gross block): Minimum Rs. 3,000 crore.
During the press briefing, Union Minister Shri H.D. Kumaraswamy stated that the scheme is a transformative initiative to attract global EV manufacturers to India. It aims to promote indigenous capabilities through structured value addition milestones and strengthen the Make in India and Aatmanirbhar Bharat missions. He added that the scheme creates a stable policy framework to invite global and domestic players into India’s green mobility revolution.
