India revamps incentives for automobiles to boost electric vehicles, hydrogen fuel cells, Energy News, ET EnergyWorld

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NEW DELHI: India has revised its proposed $ 8 billion auto sector program, which will now focus on incentivizing companies to build electric and hydrogen vehicles, two sources familiar with the plan told Reuters .

This is a significant change from the government’s original plan to encourage automakers and auto parts manufacturers to build primarily gasoline-powered vehicles and their components for domestic sale and export, with an advantage. additional for electric vehicles (EV).

The switch to clean tech comes as Tesla Inc prepares to enter India and pushes for lower import duties https://reut.rs/3hWd2Ok on electric cars. As the government examines demand, it wants economic benefits in return, which could include a commitment from Tesla to produce cars locally.

Under the new proposal, India will offer incentives to automakers to build electric vehicles and hydrogen-only fuel cell cars, the sources said.

“The government doesn’t want to spend money promoting old technologies,” one of the sources said.

Auto parts makers, however, will be incentivized to produce clean car components as well as invest in safety-related parts and other advanced technologies such as sensors and radars used in connected cars, the automatic transmission, cruise control and other electronic devices, the sources said. .

“The idea is to promote the development of a technology that is currently not manufactured in India but is imported either because regulations require it or because customers want these features in their cars,” said the second source.

The sources said that initial incentive spending of around $ 8 billion could also be reduced, and the production-related program, which would apply to domestic sales and exports, could be finalized by the end of September.

India’s ministries of industry and finance did not immediately respond to a request for comment.

India’s efforts to promote electric vehicles, which account for a fraction of total auto sales, have so far been hampered by lack of investment and low demand, as well as the disparate nature of existing incentives. which vary from state to state.

But the government is focused on adopting clean mobility to reduce its dependence on oil and reduce pollution, while respecting its commitment under the Paris Climate Agreement.

National automaker Tata Motors is currently India’s biggest seller of electric cars with rival Mahindra & Mahindra as well as motorcycle companies TVS Motor and Hero MotoCorp consolidating their EV plans.

However, India’s largest automaker, Maruti Suzuki, has no short-term plan to launch electric vehicles because it doesn’t see volumes or affordability for consumers, its chairman said last month.

The incentive program is part of India’s larger $ 27 billion program to attract global manufacturers to boost domestic production and exports.

(Reporting by Aditi Shah; Editing by Emelia Sithole-Matarise)


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