The year 2024 marked a historic milestone for the electric vehicle (EV) industry, with global sales soaring by 25%. This surge reflects a growing shift in consumer preference and the world’s commitment to a greener future. So, what’s driving this unprecedented growth?
China has maintained its global leadership in EV adoption, while Britain surpassed Germany to become Europe’s largest market for battery-electric vehicles. Let’s now take a closer look at the Indian EV landscape.
The EV Indian Industry: Facts & Figures
The Indian EV market is on an accelerated growth trajectory, with projections suggesting it will expand from $3.21 billion in 2022 to $113.99 billion by 2029, registering a compound annual growth rate (CAGR) of 66.52%.
Several factors are fueling this remarkable growth:
- Environmental Concerns: EVs are a cleaner alternative, producing significantly fewer greenhouse gas emissions.
- Fuel Prices: With petrol prices in Mumbai hitting ₹103.50 per liter (up from ₹77.57 to ₹89.02 just five years ago), EVs offer a cost-effective solution.
- Government Support: Financial and infrastructural initiatives have made EV adoption more accessible.
Also Read: Top 5 Electric Vehicle Stocks in India
Government Initiatives to Promote EVs in India
The Indian government has implemented various measures to boost EV adoption:
Tax Incentives
- Faster Adoption and Manufacturing of Electric Vehicles (FAME): A flagship scheme offering financial incentives for EV purchases.
- Production Linked Incentive (PLI) Scheme: Encourages the production of electric two-wheelers (e-2W), three-wheelers (e-3W), four-wheelers (e-4W), buses, and trucks.
Infrastructure Development
- Public Charging Stations: The Bureau of Energy Efficiency (BEE) has developed plans to establish public charging stations in major cities.
- Model Building By-Laws: Updated by the Ministry of Housing and Urban Affairs to include provisions for charging infrastructure.
Public Awareness Campaigns
- Go Electric Campaign: Launched in 2021 to educate the public about EV benefits.
Additional Initiatives
- National Programme on Advanced Chemistry Cells (ACC) Battery Storage
- Electric Mobility Promotion Scheme (EMPS) 2024
- Scheme to Promote Manufacturing of Electric Passenger Cars in India
The Core of EVs: Battery Technology
India’s ambitious goal of achieving net-zero carbon emissions by 2070 heavily depends on vehicle electrification. The heart of every EV lies in its battery, which determines performance, cost, and adoption rates. Here’s an overview of India’s EV Battery Manufacturing Journey:
Infrastructure & Land
India’s slow land acquisition process (ranked 150th by the World Bank in 2020) poses a challenge. However, key projects like Tata Chemicals’ 127-acre facility in Gujarat and the Suzuki-Denso-Toshiba lithium-ion plant highlight progress.
Raw Materials
India relies heavily on imported lithium-ion cells. Initiatives like Log9 Materials’ climate-adapted batteries and KABIL’s global partnerships (with countries like Australia and Chile) aim to reduce this dependency.
Skilled Workforce
A shortage of skilled labor for EV-specific roles has led to government programs through Industrial Training Institutes (ITIs) and specialized skill training.
Transport & Logistics
India’s strategy to refine imported raw minerals for higher export value enhances its relevance in the global EV supply chain.
Manufacturing Cost
India offers competitive manufacturing costs, with subsidies bringing the cost of NMC pouch cells as low as $65/kWh. The Production Linked Incentive-ACC program further enhances cost-effectiveness.
Government Policies
Supportive policies like reduced GST rates and the PLI Scheme drive local production. Programs like FAME II and the Phased Manufacturing Programme (PMP) aim to make EVs more affordable.
Geopolitical Advantage
India’s strategic location and partnerships through the Mineral Security Partnership and Free Trade Agreements (FTAs) diversify global supply chains away from China.
Government Subsidies
Production-linked incentives and state-level support continue to attract investments into the sector. India’s strategic measures, combined with partnerships and infrastructure development, position it as a potential global hub for EV battery manufacturing.
What Lies Ahead?
India’s EV future is exceptionally bright, fueled by:
- Robust government policies
- Rapid advancements in EV technology
- Changing consumer preferences
Despite challenges like land acquisition and raw material dependency, the sector holds immense potential. With continued efforts, India is well on its way to becoming a global leader in the EV industry, paving the way for a sustainable and eco-conscious automotive revolution.
