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New Delhi: With the cost of developing and operating electric vehicles (EVs) expected to decline substantially with a drop in prices of lithium-ion batteries, India is likely to become a leading hub for manufacturing EVs and EV components, said Nitin Gadkari, the Union minister for road transport, highways and MSMEs, at an event hosted by Amazon on Sunday.

The Union government is also focusing on other alternative technologies, such as hydrogen fuel cell-driven EVs, besides announcing a scrappage scheme to help boost manufacturing of EVs for exports, Gadkari added.

The Narendra Modi administration has urged vehicle manufacturers to increase local production of EVs to increase the number of zero-emission vehicles plying on Indian roads, curb vehicular pollution and reduce the country’s dependence on crude oil imports.

“Our country imports around 8 trillion of crude oil and this is going to double in the next four to five years, which will have a huge impact on the economy. It is necessary to look for an efficient and alternative mode of energy for future mobility needs. India is a power surplus nation and e-mobilty will be the most effective solution to develop import substitute, cost-effective, indigenous and pollution-free modes of transport," said Gadkari.

He said India could be the largest manufacturing hub for electric two- and three-wheelers and cars, and the Union government is actively working to support the industry by framing favourable policies, such as reducing goods and services tax on EVs to 5%, besides other incentives.

Besides urging the manufacturers to develop low-cost EVs, the government has also been asking e-commerce companies to shift their goods delivery fleet to electric and help push the number of electric vehicles plying on Indian roads.

Accordingly, e-commerce majors, such as Flipkart and Amazon, have plans to shift their existing vehicle fleets to electric.

Jeff Bezos-led Amazon said it will introduce 10,000 units of electric vehicles in its goods delivery fleet in India by 2025.

The Seattle-headquartered company has also announced that it is collaborating with Mahindra Electric, the electric vehicle manufacturing arm of Mahindra and Mahindra, to induct the Treo Zor electric vehicle in its delivery fleet.

Walmart-owned Flipkart plans to introduce 25,000 units of electric vehicles in its fleet to cut down on vehicular emission.

Other e-commerce players and food delivery startups are also planning to follow suit in the coming years.

According to Gadkari, the Union government wants electric vehicles to form 30% of all private cars, 70% of commercial vehicles, 40% of buses and 80% of two- and three-wheeler sales by 2030.

“I am confident that India is marching ahead towards making electric vehicles and in due course of time we will be the No. 1 manufacturing hub of electric vehicles. I am happy that companies like Amazon are encouraging this. I have been working on this mission for the last few years and it highlights the role of our automakers and e-commerce companies to achieve our environmental sustainability goals," he added.

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