Govt to create policy in support of domestic EV manufacturing

The government is formulating a policy to promote domestic production of EVs, aiming to create a fair environment for the industry, according to media reports. This initiative fosters job growth and contributes to reducing the overall prices of electric cars.

The Department for Promotion of Industry and Internal Trade (DPIIT), operating under the Ministry of Commerce & Industry, has initiated discussions to establish a program that provides incentives to manufacturers of electric four-wheelers based on their investments in local vehicle production, according to the reports.

A senior government official mentioned that this incentive focuses on manufacturing in contrast to Faster Adoption & Manufacturing of Electric Vehicle II (FAME II), which offers direct subsidies to consumers. The official added that the government is exploring extending incentives to vehicle manufacturers based on their local electric car production investments.

Discussions are ongoing to determine the minimum investment threshold required for automakers to qualify for benefits under this scheme as the government evaluates the scheme’s budget.

This development is occurring as international automakers like Tesla and VinFast, as well as domestic companies like Maruti Suzuki, Hyundai Motor India, Kia, Tata Motors, and Mahindra & Mahindra (M&M), are considering introducing numerous electric vehicles in the Indian market.

Last month, Minister of Commerce & Industry Piyush Goyal expressed the government’s commitment to ensuring a level playing field in the industry. He stated that some automobile industry participants, in addition to Tesla, have expressed interest in entering the Indian market, and he emphasised the need for fairness and non-discrimination.

Source: Economic Times