“EV supply chain is set to become robust”

Views of NITI Aayog’s Sudhendu J. Sinha

Sudhendu J. Sinha, Adviser (Infrastructure Connectivity, Transport and Electric Mobility), NITI Aayog

Transitioning to electric mobility is a crucial element of the global green mobility movement as it can play a momentous role in decarbonising the transport sector. India is among the few countries that support the global EV30@30 campaign, which aims at electric vehicles (EVs) comprising at least 30 per cent of new vehicle sales by 2030. In order to mainstream EVs in India, a robust network of EV charging infrastructure is necessary. At a recent conference on “EV Charging Infrastructure in India”, organised by Renewable Watch, Sudhendu J. Sinha, adviser (infrastructure connectivity, transport and electric mobility), NITI Aayog, shed light on the progress of EV mobility in India. Excerpts…

Progress in India

Electric mobility is believed to be a logical corollary to the transformation of mobility in India. The sector is crucial for its wide-spanning links to the environment, quality of air, orchestrated mobility, health and the economy. The Government of India has instituted various enabling policies to promote electric mobility. The National Mission for Electric Mobility was approved in 2019 for localising the production of EVs and their components. An interministerial committee on EVs was also established in collaboration with stakeholders across the value chain. The Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) I policy was introduced in 2015, followed by FAME II in 2019. The policies provide subsidies and financial incentives to boost EV production. These subsidies also prioritise the quality of EVs, as they are based on performance indicators such as vehicle range and mileage.

However, progress in the sector was found to be slow. This led to a restrategising of the FAME II policy. The new strategy seeks to make various interventions to cater to different segments within electric mobility. The incentives for two-wheelers have been increased. For three-wheelers, the focus is on aggregation of demand and bulk orders. Lastly, for buses, instead of spreading resources thinly across the country, certain cities have been identified for the proliferation of electric buses, all of them with populations of over 4 million. Eventually, the entire supply chain is expected to become robust. Electric mobility has also found prominence in state policies. Green mobility is no longer just a national agenda; state governments too are laying emphasis on the need for state-specific EV policies, and many states are at the final draft stages of their respective policies. To encourage rapid development of EV infrastructure in the states, the Government of India is set to introduce an Electric Mobility Index, which will assess the states’ performance in EV uptake.

Focus

The production-linked incentive scheme is expected to identify the principal manufacturers of advanced chemistry cell (ACC) batteries at a gigawatt scale. Time anxiety among consumers will also be addressed. The creation of charging infrastructure will be made a mass movement. Regulatory incentives may be altered to add charging points in public and semi-public spaces. Visible availability of charging infrastructure will give immense confidence to consumers. Existing gas stations are expected to have at least one charging point each, keeping in mind safety aspects. Alternative models of charging are also being reviewed. Further, the government is looking at the possibility of permitting battery swapping to allow access to FAME subsidies and EV tariffs. The principle of equity, however, will be integral to decision-making.

The way forward

An integrated approach among all key stakeholders is crucial to speeding up the establishment of EV firms and allied businesses. The government seeks active private sector participation in setting up EV charging infrastructure. It may not be feasible to set up charging infrastructure throughout the country without a proactive partnership with the private sector. To this end, the government has issued the bids for charging infrastructure on highways to both government entities and private sector players. The private sector can also play a key role in spreading awareness about EV infrastructure among the masses.

At present, without subsidies and financial incentives, EVs tend to be costlier than internal combustion engine vehicles. Cost parity for EVs is expected to be achieved when the country establishes robust manufacturing capabilities for ACC batteries. As of now, India is completely dependent on imports for ACC batteries. Local production and economies of scale are the key factors for reducing the cost of EVs.

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