The industry has made significant progress in recent years. While EV adoption initially focused on three-wheelers and lead-acid batteries, it has now gained mainstream attention among daily commuters. Although electric two-wheelers currently account for less than 10% of total registrations, a Redseer report projects their penetration to reach 60%-80% of the two-wheeler market by 2030.
EV registrations in India have surged, reaching 1,02 million units in 2022 from 330,000 units in 2021 and 120,000 units in 2020. As of 2023, 420,000 EV registrations have been recorded, with two-wheelers contributing 62% and three-wheelers contributing 33% of the total. Despite a recent decline in growth rates, government incentives like the FAME-II scheme and state-level policies have played a crucial role in driving EV adoption.
India’s commitment to climate goals has spurred the push for EV adoption. With a pledge to achieve net-zero emissions by 2070, India aims to reduce emissions intensity by 45% by 2030. The government has implemented incentive schemes and policies to promote renewable energy and clean industries such as EV manufacturing.
The reliance on imported crude oil has amplified the need for electric mobility. In FY22, crude oil imports reached 212.2 million tonnes, resulting in a $119 billion import bill. To address this, the Indian government supports domestic EV players through subsidies, incentives, and the attraction of foreign investments.
The foreign investment in India’s EV sector is expected to exceed $20 billion by 2030. International investors have already backed domestic EV startups and businesses, including Rocketship and Magna International in Yulu, bp in BluSmart and Magenta Mobility, and bp in BluSmart. Foreign investments are helping established automotive companies like Mahindra & Mahindra.
India’s EV industry is poised for significant growth, fueled by increasing adoption, government support, and foreign investments. With its ambitious climate goals, the country is committed to reducing emissions and promoting clean energy industries. By embracing electric mobility, India can reduce its reliance on imported crude oil, foster economic growth, and contribute to a sustainable future.
Do you believe the Indian government’s incentives and policies are effectively driving EV adoption in the country? Why or why not?
Source: INC42
