- By JE Auto Desk
- Wed, 24 Jan 2024 06:57 PM (IST)
- Source:JND
Budget 2024: The electric vehicle (EV) segment in India, especially electric two-wheelers, is seeing a remarkable increase and is expected to grow significantly soon. Projections suggest that the electric two-wheeler sector will surpass one million units in 2024. This positive outlook is influenced by factors like rising demand, improved production capabilities, affordability and increasing environmental awareness among consumers. Government incentives and technological advancements also contribute to the shift toward sustainable transportation. As we look forward to the Union Budget 2024, the EV industry in India is optimistic about transformative changes, especially in government policies and initiatives. Speaking about the upcoming Budget, Sumeet Gupta, MD & Co-Founder of Vegh Automobiles, shared his insights into what the EV industry is expecting from this year's Budget.
Adoption of FAME 3 Incentive Scheme
"We wholeheartedly welcome the government's decision to introduce the flagship incentive scheme for manufacturing electric vehicles (EVs), FAME 3, into the next financial year. This move is crucial in sustaining the momentum of the EV sector," he said.
"The proposed adoption of the FAME 3 will not only catalyse the expansion of EV charging infrastructure but also address range anxiety concerns, fostering wider adoption of EVs. As we look forward to the interim budget, the hope is for additional resources to be allocated to extend the corpus for incentives, providing further support to EV manufacturers," Gupta added.
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Boosting India's Manufacturing Prowess
"Recognising India's potential as a manufacturing powerhouse, there is also a widespread acknowledgement that significant strides are necessary to increase the country's global manufacturing share. We expect the Budget 2024 to address this by implementing measures that further boost manufacturing capabilities and competitiveness on the global stage," Sumeet Gupta said.
"Trade agreements that incentivise exports and emphasise strengthening the logistics sector are anticipated to be focal points for capitalising on India's momentum as a new-age manufacturer," he added.
Research and Development Incentives
In light of the constrained and monopolised supply scenario of lithium globally, there's a pressing need for India to invest in research to develop indigenous and cost-effective machinery and technology. The absence of research-linked incentives in the previous budget underscores the importance of prioritising R&D in the EV sector.
"The EV industry wishes that the upcoming interim budget will include a focus on incentivising self-sufficiency-focused research and development, especially in battery technology and machinery development. This approach is going to be a crucial element in securing a robust and sustainable future for the EV industry in India," Gupta further said.
Incentives for EV Battery Cell Manufacturing
"We're hoping the government will announce extra incentives for manufacturing EV battery cells as well. Recognising the critical role that batteries play in the EV ecosystem, additional incentives would not only bolster battery manufacturing but also contribute to reducing dependency on imports, aligning with the overarching goal of self-sufficiency in the EV sector," he said.
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As India gears up for Budget 2024, it is expected that the vote on account will present a collective vision for sustainable growth, technological advancement and self-sufficiency. Emphasis on manufacturing prowess, research and development incentives and support for battery manufacturing reflect a comprehensive strategy to accelerate the transition towards cleaner and more sustainable mobility solutions. These expectations, if realised, will undoubtedly contribute to India's position as a key player in global electric vehicle manufacturing.