The guidelines released recently by the power ministry for setting up charging infrastructure will go a long way in allaying the apprehensions of existing and prospective manufacturers of electric vehicles in India. The guidelines can be considered the first major step taken by India to push electric mobility but leave a lot of unanswered questions. However, let’s take a look at the positives first. The decision to allow private charging stations to be set up at residences and offices will surely encourage potential buyers of electric vehicles. Also, that an individual setting up a station will not require a licence and power distribution companies will set up a connection on a priority basis are welcome steps. The fact that most of the charging stations in the first stage will be established in mega cities such as Delhi and Mumbai is also indicative of the government’s resolve to reduce vehicular pollution in leading urban centres. Most of the these cities have recorded alarming levels of pollution in the last few years and the lack of charging infrastructure has been the major roadblock for would-be buyers of electric vehicles.
However, the guidelines will not fully assuage concerns of the customers and manufacturers. Basic things, such as the incentives on offer for an individual or a corporate entity for setting up charging stations, were not mentioned. Also, there is lack of clarity on issues such as who will provide the land for the charging stations, and whether it would be given by the government at a discounted rate. One can understand fiscal incentives will be a part of the main electric vehicles policy, or the second phase of the Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles or FAME scheme. Hence, the power ministry did not have the mandate to issue any guidelines, but why leave out the Chinese standard of charging known as GB/T when Chinese companies are leading vehicle manufacturing across the globe?
Most electric cars, buses, two- and three-wheelers running on Indian roads at the moment are compatible with the Chinese standards as opposed to the Japanese CHAdeMO, or the CCS of standards of the Europeans and Americans. So, what happens to these vehicles when these new fast-charging stations come up? Chinese companies like SAIC Motor and BYD have been making high-quality electric vehicles, while most of the Japanese, American and European manufacturers are yet to develop an affordable electric power train. Leaving aside the geopolitical tensions with China, our policymakers need to understand that Chinese companies may help develop the electric vehicle ecosystem in India just like the Japanese ones did when the internal combustion engine manufacturing ecosystem was being established almost three decades ago.
Finally, reports suggest that the government may also resort to levying an additional cess on traditional vehicles to generate funds to offer incentives for electric vehicles. This is unfair to the industry as vehicle manufacturers have invested heavily to comply with the new safety, efficiency and fuel efficiency norms. Funds to promote electric mobility should be generated from existing extra taxes levied on diesel vehicles, or the government should reduce the goods and services tax on vehicles to 18% from 28%, before imposing a new cess.