Why auto giants and start-ups are showing interest in electric vehicles

A few months ago, the NITI Aayog noted that the country can save up to Rs 17,000 crore if EVs hit the road by 2030.

Updated: November 30, 2019 10:12:17 AM

By Sqn Ldr Prerana Chaturvedi

The government is doing a phenomenal job of promoting electric vehicles (EVs). The pace at which things are moving, we can safely say that EVs will be the single largest disruptor to hit the automobile industry in its 134-year history. A few months ago, the NITI Aayog noted that the country can save up to Rs 17,000 crore if EVs hit the road by 2030. This figure is based on the assumption that the vehicles eligible under FAME II can cumulatively save 5.4 million tonnes of oil equivalent over their lifetime.

Profitable policies

In the Union Budget 2019-20, there were two important decisions highly appreciated by EV stakeholders—an additional income tax exemption of Rs 1.5 lakh for those buying EVs, and 5% reduction in GST on EVs. It is evident that the finance minister has taken these initiatives in the light of imminent benefits India is expected to enjoy after EV transition.The push by the government saw many players jumping into the fray, and the last few months have seen auto giants showing interest in EVs.

Potentially powerful

India has around 370 million two-wheelers, and saving fuel is not the only gain, lower emissions also are. If we assume that these 370 million are turned electric, it could cumulatively save 474 million tonnes of oil equivalent worth Rs 15 lakh crore and generate net carbon dioxide savings of 846 million tonnes over their operational lifetime.
A recent report noted that 87% of the country’s population who own a vehicle are willing to switch to EVs. At a time when we are grappling with high pollution levels, we must learn from China, which has around 250 million electric two-wheelers, with annual sales of 30 million.

However, electric two-wheeler adoption is almost exclusively limited to China. Amidst all this, there is an even more impressive story, one that is not often told. Of the total carbon dioxide emissions saved by EVs worldwide, over 80% were due to China’s electric two-wheelers alone. There are close to a billion two-wheelers running in the ASEAN, China and India.

Promising prospects

By potentially electrifying all two-wheelers in use, India can avoid 35% of total transportation emissions and, importantly, about 60% of particulate matter, curbing air pollution. Besides, amidst the ongoing slowdown in the auto sector, a smooth transition will be a blessing in disguise as many indigenous players are planning to enter the segment. EVs are India’s future, and it’s time to make this transition swift and smooth.

The author is CEO & ED, Evolet, an electric mobility start-up. Views are personal

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