Discontinuation of customer subsidy a concern for EV industry

Sumedha Sharma

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Gurugram, February 1

State’s electric vehicle (EV) startups have lauded the interim budget 2024 for proactive support extended to strengthen electric vehicle ecosystem, even though slight concern has been voiced over reduction in customer-centric incentives.

While Finance Minister Nirmala Sitharaman reiterated her government’s push for expanding EV manufacturing, the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicle (FAME) subsidy budget estimate has come down by 44% to Rs 2,671 crore in FY25.

While a significant emphasis has been laid on promoting environmentally friendly public transportation system, the non-continuation of some direct customer subsidies may affect the adoption of electric vehicles across various categories.

“As we move ahead, the adoption of cleaner and green transport alternatives, rationalising the GST tax structure on EV charging and batteries, coupled with the reinforcement of existing EV policies and the introduction of new ones, will play a critical role in promoting electric mobility and achieving India’s climate goals,” said Anmol Singh Jaggi, CEO and Co-founder of BluSmart __ an all-electric ride-hailing mobility service.

Sohinder Gill, Director General of Society of Manufacturers of Electric Vehicles, said: “A notable absence is observed in continuation of direct customer subsidies, a crucial component that played a significant role in adoption of electric vehicles across various categories.”