EV sales up 53.6% at 4.4 lakh in FY23 so far: Govt

The government has said it received complaints regarding the misappropriation of subsidies under the government’s FAME India Phase II scheme by some EV makers. These complaints relate to the violations of phased manufacturing programme guidelines under the FAME India Scheme Phase-II. All the complaint cases have been referred to the testing agencies for re-verification, said minister of heavy industries Mahendra Nath Pandey.

He said the government has even taken action against two OEMs. "After examination of reports in respect of two OEMs, the models of these two OEMs have been suspended from the FAME scheme. Further, the processing of their pending claims has been stopped till they submit sufficient evidence to show their compliance to PMP timelines," he stated in a report tabled in the Lok Sabha today.

The minister also elaborated on the sale of electric vehicles under the FAME Phase II scheme, saying 4,42,901 EVs were sold in FY 2022-23 up to December 9, 2022. This is about 53.6% up from 2,37,811 EVs sold in FY22.

The FAME India Scheme Phase II has been launched to help in the demand generation of electric vehicles by reducing the cost of acquisition of such vehicles. As per Nath, as the demand for electric vehicles is increasing, the pace of implementation of the FAME India Scheme also increasing.

The minister said the Centre has taken some initiatives to bring the cost of electric or hybrid vehicles at par with those with internal combustion engines. "The demand incentive for electric two-wheelers has been increased to Rs 15,000/KWh from Rs 10,000/KWh along with an increase in cap from 20% to 40% of the cost of an electric vehicle with effect from 11th June 2021."

The government in May 2021 last year approved a Production Linked Incentive (PLI) scheme for the manufacturing of advanced chemistry cells in the country. The scheme aims to lower the prices of batteries in the country, which could further bring down the cost of electric vehicles. The PLI Scheme for automobile and auto components was notified on September 23, 2021. The scheme also aims to incentivise electric vehicles, said the minister.

Additionally, the GST on electric vehicles has been reduced from 12% to 5%; GST on chargers or charging stations has also been cut to 5% from 18%, the minister said.

India is seeing a continuous upsurge in EV adoption. The EVs industry in the country is expected to create new revenue and profit pools in India. According to the latest report by Bain & Company, the EV value chain is expected to generate $76 billion-$100 billion of cumulative revenue opportunity and $8 billion-$11 billion of profit for the country. The global consultancy expects 35-40% of all vehicles sold in India by 2030 to be EVs, up from 2% in 2022.

The two-wheeler and three-wheeler segments will be the vanguards for EV adoption, achieving 40-45% penetration by 2030, the report says.