Charging Ahead: Electric Vehicle Industry in India
“EVs are an important part of the mobility revolution, but a multi-pathway approach is needed for a carbon-neutral future.” These are some words by the chairman of Toyota Motors, Akiyo Toyota. This statement further strengthens the future of the electric vehicle industry around the world and the desire of private players for greener energy, which is combined with growing awareness of environmental issues. India is progressively becoming a vital player in the global EV revolution as it transitions to more sustainable practices. Given the rapidly increasing demand for environmentally friendly automobiles, the electric vehicle industry in India offers enormous growth potential with international standards and safety.
• At Atulyatech, we are proudly a part of this change. We are consistently working on providing sustainable solutions for the EV industry to support the growth of the electric vehicle ecosystem.
Why are electric vehicles becoming popular in India?
Here are several factors contributing to the popularity of EVs in India:
- Environmental Awareness: More people in India are moving towards making an environment-friendly choice by opting for EVs rather than gas-run vehicles.
- Rising Cost of Petrol/Diesel: Consumers are finding EVs more cost-effective when compared to gas-powered vehicles because of the global rise in fuel prices.
- Support from the Government: The Indian government is actively participating in promoting EVs by providing them with tax benefits and EV infrastructure.
- Urbanisation: As EVs are quieter and smoke-free, the urban population is moving towards them, as they provide a more sustainable solution to traffic and congestion.
The Impact of Government Policies on the Electric Vehicle Industry in India.
Many countries in the world are planning to phase out electric vehicles by the end of this decade. India is also among these countries to follow the same plan. Diesel and petrol engines are among the reasons for poor air quality in cities because they are more commonly known for releasing particulate matter (nitrogen oxide from diesel) and smoke. Their future in automobiles appears increasingly dubious due to mounting pressure from governments and environmental protection organisations to prioritise cleaner alternatives. The government, under BS6 norms, has influenced many companies to stop the production of diesel vehicles and promote hybrids and EVs in their catalogues. Here are some initiatives taken by the Union Government to boost the EV industry in India:
- FAME India: Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India is what FAME stands for. The National Electric Mobility Mission Plan (NEMMP) includes the initiative as a government subsidy. This plan worked on making public transport electric in many states. Financial assistance and subsidies were also provided by the government for establishing public charging infrastructure. This initiative aims to build trust and confidence among electric vehicle users.
- Electric Mobility Promotion Scheme: This scheme was launched in April 2014 and aims to boost electric mobility and infrastructure in India to promote electric vehicle manufacturing in India. The scheme also provided incentives for battery-equipped vehicles like E-rickshaws, e-carts, etc.
- Battery Swapping Policy: The government has also introduced a battery swapping policy, which is as interesting as it sounds. It is a process of swapping drained batteries with fully charged ones. The policy addressed the standardisation of battery sizes and other specifications like identification codes, recycling and refurbishment processes, and subsidy schemes.
- Other initiatives of the Union Government:
- Reduction of GST from 18% to 5% on electric vehicles
- Reduction of road tax on EVs to lower the initial cost of EVs.
- Due to the constant effort from the government, many public EV charging stations are operational on every major highway and motorway across the country.
The Role of Big Private Players in the Electric Vehicle Industry
According to Fortune Business magazine, the Indian electric vehicle market is going to reach $113.99 billion by 2029 at a CAGR of 66.52%. This growth will be fuelled by companies like Mahindra & Mahindra, Tata Motors, Hero Electric, Ola Electric, Ather Energy, etc. Electric vehicles were identified by the government as a good option to replace diesel and petrol vehicles, and by 2030, EVs are expected to account for 30% of all vehicles. The demand for electric vehicle service providers and battery manufacturers is going to increase with this growth. Below are some initiatives taken by private companies in the growth of the electric vehicle industry in India:
- Tata Motors (including its subsidiary, Jaguar Land Rover) has aimed to generate almost 1/3 of its revenue from EVs by the end of 2030.
- A company known as Macquarie Group has launched Vertelo,’ which is an EV financing brand that will provide financing, fleet management, and charging infrastructure solutions.
- Mahindra and Mahindra Motors announced an investment of Rs. 10,000 in electric vehicle manufacturing in January 2023.
- Ather Electric has been working on increasing the range of their scooters with a much higher mileage per charge.
- In March 2024, Ola Electric announced the introduction of an electric rickshaw that will be comfortable and drivable on Indian roads.
- Adani TotalEnergies E-Mobility Limited (ATEL) has collaborated with all-electric cab aggregator Prakriti E-Mobility (Evera) to deploy EV charging infrastructure.
- With all these big private players in the market, Atulya Teach is a key player in this industry by providing solutions and services like lithium battery manufacturing, a multi-brand EV showroom, and EV rentals & fleet solutions.
Challenges Faced by the Electric Vehicle Industry in India
While India’s EV sector projects a great future ahead. There are few markers on which it faces severe challenges that should be addressed by the private players and the government. Here are some challenges faced by the industry:
- High Purchase Cost: Electric vehicles are still very expensive when compared to diesel and petrol vehicles, and they are unaffordable to a large majority of Indians, especially in rural areas and small towns.
- Lack of Infrastructure: While there has been a significant growth of the charging infrastructure in the Urban areas and major highways, rural areas still lack such development.
- Public Acceptance: There is still some hesitation when it comes to EVs in the eyes of the public because of the safety reasons, myths about EVs, and resistance towards adopting a new technology.
- Weather Conditions: India’s tropical climate poses a big challenge for the performance and safety of battery-powered vehicles.
Conclusion
The growing environmental awareness is also one of the reasons for this growth, with the technological development taking place on a large level in this industry. Atulyatech is committed to its objective to support this transition by providing high-quality services to all its consumers. Even though there are a few concerns to address, the electric vehicle industry in India has a bright future ahead, driven by significant annual growth; the efforts taken by the government also act as a catalyst.
As India is moving towards an EV revolution, Atulyatech is standing tall in this revolution by providing sustainable and innovative solutions for this industry.