India plans to go all electric with green car incentives
The most influential Government think-tank in India has recommended lowering taxes and interest rates for loans on electric vehicles at the same time capping sales of conventional cars.
This signals a huge shift in Indian Government policy and this will affect global trends as well as India is one of the world’s fastest growing auto markets.
A government draft is outlining a proposed plan to open a battery plant by the end of 2018 and use tax revenues from all petrol and diesel vehicle sales to set up charging stations for electric vehicles.
The planning body is headed by India’s Prime Minister, Narendra Modi himself and they are aiming to have every vehicle in the country electric by 2032.
The latest move sees a shift in policy towards electric vehicles and away from the current policy that incentivises both hybrid vehicles and electric cars.
India plans to bypass the hybrid technology altogether and move directly to the push towards sales of plug-in vehicles including subsidies, research funding and rules to discourage fossil-fuel cars in big cities.
There are obviously many obstacles still to be crossed. High battery costs would likely push up car prices in the short term and then there is the lack of charging stations and other infrastructure which will mean car makers may hesitate to make the necessary investment.
One India Government source said:
“If we accelerate electric vehicle growth it will be a disruption for the auto sector and would require investment, but if we’re not able to adapt quickly we risk being net importers of batteries. There has been resistance from car makers.”
Back in 2015 India launched a new scheme offering incentives for clean fuel technology vehicles. It was hoped that this particular incentive would boost their sales to up to seven million vehicles by 2020.
But despite these incentives as high as 140,000 rupees (€1,988) on some cars the scheme has made little progress.
At this time, sales of electric and hybrid cars only made up a fraction of the three million cars sold in India in 2016.
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