India is pushing ahead with plans to shift to electric vehicles (EVs) to cut down on fuel imports, reduce pollution, improve air quality, and boost its renewable energy usage by using EV batteries for storage. The country has set a goal that by 2030, 30% of all vehicle sales should be electric. Although India has made progress—from just 50,000 EV sales in 2016 to 2.08 million in 2024—the pace is still slow compared to countries like China, the US, and the EU.
As of 2024, EVs make up just 7.6% of all vehicle sales in India. To meet the 30% target by 2030, this percentage needs to grow rapidly. Electric two- and three-wheelers are doing relatively well, but electric buses, cars, and especially long-haul trucks are still lagging. In fact, out of over 8 lakh trucks sold in 2024, only about 6,000 were electric, most of them being small-capacity trucks for short distances.
To understand the challenges and find solutions, NITI Aayog held seven consultation meetings with vehicle manufacturers, fleet operators, battery makers, charge point operators, and financial institutions. The major issues discussed included the high upfront cost of electric buses and trucks, lack of access to affordable financing, poor awareness of EV benefits, low utilization of public charging stations, and poor coordination between key stakeholders like DISCOMs, municipal bodies, and transport departments.
To overcome these, the report suggests a shift from offering incentives to applying mandates and disincentives—such as regulations to gradually phase out ICE vehicles. Instead of spreading EV promotion evenly across India, it recommends focusing on a few cities and making them 100% EV-ready with electric buses, paratransit, and freight vehicles. For this, five cities can be selected in the first phase and later expanded to 20 and eventually 100.
For heavy vehicles like trucks and buses, which account for more than 50% of transport emissions but form only 4% of the fleet, the report recommends a dedicated blended financing fund supported by public and multilateral banks. Leasing and battery-as-a-service models should be promoted to lower upfront costs. More attention is also needed on R&D for new battery technologies to reduce India’s dependency on imported rare earth materials.
Another key area is the charging infrastructure. While India has a moderate number of charging stations, poor location planning and high cost of public charging are major bottlenecks. The report suggests identifying strategic corridors, especially on highways, and establishing state-level nodal agencies to ease approvals, coordinate planning, and provide accurate EV information via a unified digital app.
Immediate next steps recommended include: drafting a clear EV transition policy with targets and timelines, establishing mandates for electric adoption across key vehicle segments, launching a saturation program in five cities, and operationalizing the blended finance fund for e-buses and trucks. An inter-ministerial committee is also proposed to solve coordination issues.
With the right actions, India can unlock a $200 billion EV opportunity while improving its environmental and energy future.
