THE E-VEHICLE EVOLUTION IS MESSIER THAN WE THOUGHT

THE government seems to be getting cold feet about continuing its raft of incentives for electric vehicles (EVs).

- GURBIR SINGH

Does the recent statement by Union minister for road transport Nitin Gadkari signal a possible derailment of long term goals? Addressing a green mobility convention in Delhi, Gadkari said subsidies for electric vehicles (EVs) may no longer be necessary for consumers. He said EVs are charged a GST of just 5% compared to 48% for gasoline vehicles. If after this, people are expecting further subsidies from the government, "then my honest opinion is now we don't need the subsidies." The minister said considering the lowering battery costs, and the increasing volume of sales, he expected price parity soon between e-vehicles and their dirty-fuel cousins. So where's the need for government intervention? The minister's school of thought seems to be growing.

The Delhi government has just announced it was rolling back the waiver of road tax on electric vehicles in its new policy.

The old policy had made EVS cheaper by 10%, but the new impost has now resulted in a near-standstill of sales, one business daily reported.

Currently a slew of demand incentives by the Union and state governments have allowed EVsto compete with similar diesel/petrol models. The FAME incentives for instance subsidizes EV cars by Rs 1.5 lakh and 2-wheelers by Rs 20,000 each. Despite these incentives, EVs continue to be more expensive than their fuel counterparts.

CHANGE OF PLANS

India being an extremely price sensitive market, has therefore been lagging on its EV targets.