No new registrations of petrol and diesel 2-, 3-wheelers as Delhi goes electric

New Delhi: Delhi on Monday unveiled an electric vehicle (EV) policy that favours battery electric vehicles (BEVs) over hybrids, mandates a phase-out of new petrol and diesel two-wheelers from April 2028, and three-wheelers and light commercial vehicles from January 2027, and limits full road-tax exemption to electric cars priced below ₹30 lakh.

The policy was welcomed by EV makers and clean-mobility experts, with industry executives saying it could become a template for other states, and experts arguing it would accelerate the shift to zero-emission transport and help tackle Delhi's chronic air pollution.

The policy, which will remain in force till FY30, also drops a proposal in the draft released in April to extend road-tax concessions to hybrids.

“The draft Delhi EV policy released for consultation in April had proposed a 50% road tax exemption for hybrid cars, but the provision was dropped after stakeholder consultations,” Delhi transport secretary-cum-commissioner Niharika Rai said in a joint press briefing on Monday that was also attended by Delhi chief minister Rekha Gupta and ministers from the state’s cabinet.

Mint reported in March this year that the Delhi government may make a U-turn on incentives for hybrid vehicles.

Announcing the policy on Monday, Gupta said ₹15,000 crore worth of investments will be made towards incentives and setting up of charging infrastructure. Rai added that 32,000 public EV chargers will be set up during the runtime of the policy.

The policy will provide purchase incentives for electric two-wheelers, three-wheelers and small trucks, chief minister Gupta said during the conference. According to officials, electric two-wheelers will get a subsidy of ₹30,000 in the first year of the policy, ₹20,000 in the second, and ₹10,000 in the third.

Similarly, electric three-wheelers will get a subsidy of ₹50,000 in the first year, ₹40,000 in the second, and ₹30,000 in the third. Light commercial vehicles (N1 category) will get incentives of ₹1,00,000, transport commissioner Rai said.

The policy also announced mandatory electrification for school buses. Schools must ensure 10% of their buses are electric within two years of the policy being implemented, and 20% of their buses within three years.

“The plan seems to be going all in for electric vehicles,” said Subhabrata Sengupta, partner at Avalon Consulting. “It makes sense because if reducing fuel use and pollution is the objective, hybrids are half a solution. It’s better to give more incentive for BEVs given the total finance pool is constrained.”

The policy announcement, which comes a month after Prime Minister Narendra Modi called for increased EV adoption to reduce India’s oil import bill, is significant because Delhi is one of India’s biggest automobile and EV markets.

Data from government portal Vahan showed that in 2026 till date, Delhi’s sales of 48,155 pure electric vehicles marked an 11.5% share of total sales of 416,334 vehicles. Comparatively, Maharashtra’s EV sales in the same period were 9.9% of the total.

Industry reaction

A Tata Motors PV spokesperson welcomed the policy.

“By retaining ambitious electrification timelines for high-usage vehicle segments and focusing policy incentives on pure EVs, the government has reinforced the principle that public support should benefit and accelerate technologies that deliver the maximum environmental benefit with zero-emissions,” the spokesperson said. “This policy provides long-term direction for the industry, strengthens confidence in India's EV ecosystem and can serve as a benchmark for other states pursuing cleaner urban mobility.”

Electric two-wheeler makers also reacted favourably to the announcement.

“We welcome the Delhi government’s new EV policy, which is proactive & forward looking,” said Sudarshan Venu, chairman of TVS Motor Company. “We are fully committed to developing sustainable mobility products and solutions to drive further EV adoption.”

“What stands out is not just the scale of the investment, but the way the policy has been designed,” said Tarun Mehta, chief executive officer (CEO) of Bengaluru-based electric two-wheeler maker Ather Energy.

“The combination of incentives, phased electrification mandates and charging infrastructure creates a very strong foundation,” Mehta said. “More critically, if Delhi can become majority EV, then it has the opportunity to become a benchmark for the rest of the country.”

“We welcome Delhi's commitment to an all-electric two-wheeler future by 2028, which alters the future of the city in many ways,” said Narayan Subramaniam, CEO & head of design at Ultraviolette Automotive, a TVS-backed electric bike manufacturer.

“The price-agnostic consumer support matters because it doesn't penalise buyers who want more from their machine—whether in terms of range, tech, performance or design—and the push on charging infrastructure finally treats energy as part of the product rather than an afterthought,” he added.

Expert feedback

Experts suggested that the policy will help reduce Delhi’s air pollution woes with air quality index (AQI) readings above 400 (severe category) in the October-January period.

Amit Bhatt, India managing director of global clean mobility think tank International Council on Clean Transportation, said the proposed phase-out of new ICE-powered two- and three-wheelers could be a game changer in Delhi’s fight against air pollution. “These segments account for a large share of the city’s vehicle fleet, and accelerating their transition to zero-emission vehicles can significantly reduce vehicular emissions,” Bhatt said.

“Delhi EV Policy is a forward-looking strategy to tackle air pollution and benefit millions towards better air quality. With an objective to clean air, technology which has zero tail-pipe emission have been given a priority. Therefore, the decision to set aside direct fiscal benefits to hybrid vehicles is a welcome measure,” said Sharif Qamar, associate director of the transport and urban governance at New Delhi-based think tank The Energy and Resources Institute (Teri).

The industry at large said the Delhi EV policy could be replicated across other states. “The policy has the potential to substantially reduce vehicular emissions while creating new economic opportunities and can serve as a model for other states to adopt similar clean mobility initiatives suited to their local needs,” said Nirmal K. Minda, president of industry lobby group Associated Chambers of Commerce (Assocham) and chairman of auto component manufacturer Uno Minda Ltd.

Some opposition

However, the proposal to introduce stiff mandates had earlier received opposition from manufacturers and dealers alike.

The proposal to ban the registrations of internal combustion engine (ICE) two-wheelers will “neither help improve AQI…nor is it practically feasible. It will severely impact the common man, small businesses and hence is likely to face public resistance,” the Society of Indian Automobile Manufacturers (Siam) had said in a letter dated 23 April, reviewed by Mint.

The mandate to only allow electric three wheelers to be registered also faced opposition from dealers association Federation of Automobile Dealers Associations (Fada), with the organization requesting a relief through a representation to the government on 11 June, reviewed by Mint.

The debate on parity of road tax exemptions for EVs vis-a-vis hybrids had earlier pitted hybrid-focused automakers Maruti Suzuki and Toyota Kirloskar Motor against EV makers Tata Motors, Mahindra & Mahindra, Hyundai and Kia.

Queries emailed to Siam, Maruti Suzuki, Toyota Kirloskar Motor, Mahindra & Mahindra, Hyundai, and Kia did not elicit an immediate response.