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Informist, Monday, Aug. 4, 2025

 

NEW DELHI – NITI Aayog, the Centre's policy think tank, Monday suggested moving on from providing incentives to the supply and demand side to encourage a shift to electric vehicles, and instead recommended opting for mandates or disincentives within a year. These incentives include the Narendra Modi government's flagship production-linked incentive schemes, vehicle purchase subsidies, and reduced import duty on key components. In a report, the NITI Aayog also suggested a slew of measures to aggressively push the adoption of green vehicles.

 

The government has spent INR 400 billion on incentives over the last 10 years to push adoption. Electric cars form just around 8% of India's car sales per year. "It is evident that continuation of incentives alone may not help reach the target of 30% EV sales in the next five years," the think tank said in its report titled 'Unlocking a $200 Billion Opportunity: Electric Vehicles in India'.

 

It has been suggested that the mandates be limited to a certain segment of the vehicle fleet in order to avoid any backlash. However, it has called for mandates to become increasingly stringent, with a wider application over time. In addition, it has been suggested that policymakers focus on saturation in limited geographies by focusing attention on limited geographies at a time, rather than on even distribution across India. This, the NITI Aayog said, would attract enthusiasm for replication. 

 

CHARGING INFRA

To scale up charging infrastructure for electric vehicles, the think tank suggested that the roads ministry identify 20 high-density corridors for electric bus and electric truck operations. Then, a study could be commissioned to identify locations for charging hubs based on current haltage patterns on these corridors within a year.

 

The Ministry of Power and state governments could establish nodal agencies in each state, similar to the model followed by Singapore. These agencies could then facilitate and enable the establishment of more charging stations. This could be done in five years, Niti Aayog said. 

 

The Ministry of Heavy Industries could set up a unified digital application for the provision of the location of charging stations, the ability to book charging slots at these stations, and pay for them. This could be done within a year, Niti Aayog said.

 

NITI Aayog has recommended the creation of a pooled fund with contributions from the public budget and multilateral development banks to provide low-interest loans to small operators for the procurement of electric buses and electric trucks. This would bring down the total cost of capital for such procurement, it said. 

 

The Department of Science and Technology could set up a partnership between academia, industry, and the government to accelerate research on new battery chemistries within five years, it said.

 

To reduce the high capital cost of an electric vehicle, the Ministry of Heavy Industries and the Department of Financial Services could nurture the establishment of a battery leasing industry. It also recommended establishing a battery passport system, which contains the details to assess the health of a battery.  End

 

Reported by Anand JC

Edited by Avishek Dutta

 

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