All over the world, the use of electric vehicles is being promoted as it is eco-friendly and helps in reducing fossil fuel consumption. Electric vehicles are very easy to use as you don’t have to buy expensive fuel for running your vehicle. All you need to do is charge up the batteries of your vehicle that runs the engine, and your vehicle is ready to go. In India, the government quickened the pace of using electric vehicles as it has passed a new order of selling electric scooters only after April 2023 and discontinue all scooters that run on fossil fuel.
It means that the companies can no longer manufacture or sell scooters with petrol engines and have to commence production and sell electric motor powered scooters only. The order of the government is aimed at reducing the vehicular pollution that is caused by the petrol engine vehicles. This cutoff date is also applicable for the three-wheelers also that come in petrol, CNG and LPG powered engines. This has been a significant move from the government as it is tightening the pollutions norms for the vehicles.
It will make the scooter and the three-wheeler manufacturers to transit their production line to make new electric scooters and discontinue the manufacturing of the petrol engine scooters and three-wheelers.
To promote the sale of the electric powered three-wheelers, the government is also doubling the direct subsidy up to Rs. 20,000 per kilowatt hour for making them affordable in comparison to those which run on fossil fuel. Apart from that, the government will also offer financial and other concessions on the electric segment. It is also looking forward to imposing strict fuel efficiency norms for new petrol and diesel vehicles.
This regularization is done by the government with the aim of reducing vehicular pollution of petrol and diesel vehicles as they have an annual sale of over two crore units, and cover almost three-quarters of traffic on the Indian roads. The time of four to six years is given to the automobile industry so that it can recover the investment which is done on a large scale for manufacturing BS-VI compliant vehicles from next year April. This time frame is will be sufficient for the companies so that they can recover the amount of money they have put for producing the new engine norms.
The order also means that all the scooters or other two-wheelers that drive out of the showroom after April 2025 with the engine capacity of 150cc should be electric powered. However, the two-wheelers which will be manufactured or sold before the cutoff date shall not face any such condition and will continue to ply. This is a huge move by the government to curb vehicular pollution and to promote sales of electric vehicles.
The government is also encouraging the automobile companies to manufacture more electric vehicles so that, the Indian automobile industry become the hub of electric vehicles as the global demand for electric vehicles is slowly soaring. But the irony in this is that the government is not offering any concession to the automakers for manufacturing electric vehicles. Instead, this benefit will be awarded to the battery makers, where the existing share of Indian battery makers is around 5% or around. With the support of benefit attained through FAME scheme, the battery manufacturers might be able to capture 81% of the value creation. According to some industry sources, the impetus on two-wheelers and three-wheeler production shall lead to 50,000 investments in the battery manufacturing and storage by the year 2025. With this step, the government will certainly curb pollution to a great extent; however, implementing the new norm with this time frame might prove to be a tricky issue.