Opinion
Mint Quick Edit | What fresh EV subsidies tell us about their market
Summary
- The government has announced fresh subsidies for electric 2- and 3-wheelers as part of the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) plan. While this should help EV adoption, it speaks of a transition agenda that may be in need of a review.
A fresh subsidy scheme to speed up adoption of electric vehicles (EVs) is to be rolled out. The PM Electric Drive Revolution in Innovative Vehicle Enhancement will give ₹10,000 as subsidy for each electric 2-wheeler sold till March 2025 and ₹50,000 apiece for battery-run 3-wheelers.
Also read: India changes gears to a new EV policy focus
These are a welcome impetus for India’s efforts to decarbonize its traffic. That said, it also reflects an underwhelming pace of EV adoption. That subsidies are still needed shows that EVs have not yet attained sufficient momentum on their own.
Also read: Vedanta Aluminium doubles down on value-added AL to cash in on India's EV drive
While heavier vehicles like buses are covered by the new scheme, electric cars are not, even though this category’s transition is going far too slow. With charging points not widely available within easy reach, a lot of would-be early adopters have been wary of making the switch.
The government remains unconvinced by the idea of easing taxes on hybrids to help these act as a bridge towards clean motoring. More competition in all EV segments may accelerate the transition, but this front has seen too little action.
Also read: Ather Energy IPO isn’t as electrifying
Ultimately, it may take local technology leaps of the kind Chinese EV makers have taken, but within more affordable price brackets.
