By Dr. Yogesh Bhatia
India’s burgeoning automobile sector and Electric Vehicles (EV) are deemed important in the current scenario. At a time when environmental concerns were beginning to hound the nation, the rapid adoption of electric vehicles comes as a great piece of news.
The transport sector in the country currently accounts for about 14 percent of CO2 emissions, with 90 percent of it arising from road transport. Clearly, a switch to clean mobility solutions is the need of the hour, and needless to say, all hopes are pinned upon innovative Electric Vehicles.
These zero-emission vehicles that use electric motors powered by lithium-ion batteries, give a strong promise and hope to the nation, which aims to bring emissions down to net zero by 2070.
Moreover, the surging fuel prices were gradually robbing away the pockets of the masses, who were actively looking out for efficient transport alternatives. Gradually, as the consumer overcame the initial hiccups toward EVs, a significant increase in demand for these vehicles has been witnessed.
As per a report, there has been a 155 percent year-on-year growth in EV sales between FY20 and FY22. Around 4,29,217 EV units were sold in FY22, as compared to 1,34,821 units sold in FY 2021. Another report states that this number is expected to cross 90 lakhs by 2027.
These promising figures have made the EV space fairly attractive for automakers, many of whom have already taken a deep dive into it and have launched various innovative models that seem to be tickling and growing consumer interest.
Many new EV launches are scheduled over the next few months, while some automakers have plans in place to electrify their existing fleets going forward. Investments in the Indian EV sector are also on the rise and have been providing the necessary push and encouragement for the sector to thrive.
Apart from this, the interest of the Government in promoting EVs has been noteworthy. A flurry of initiatives has been introduced, including subsidies and regulations, which aim to push the adoption numbers upward.
Some of these key initiatives are a reduction in the GST rate for EVs to 5 percent (with zero cess), tax exemption of Rs 1.5 lakh to those buying EVs on loan, etc. Further, in line with the Make In India initiative, the government has also been incentivising manufacturers to produce EV components domestically.
In-house manufacturing of key EV components can reduce the burden on imports and also bring down the cost of the vehicles, thus making them more affordable.
Needless to say, all the efforts seem to be in the right direction and the various initial hurdles have been overcome successfully. Yet, a plethora of challenges remain that are blocking the road to EV success.
The lack of adequate EV charging infrastructure in the country is a big impediment to EV growth, which needs immediate attention even at the state level.
As per a report, India needs to install around 4 lakh charging stations by 2026 in order to meet the charging needs of 20 lakh electric vehicles. The country still lacks the infrastructure for EV manufacturing, and also the technological capabilities to manufacture chips or lithium-ion cells.
Apart from this, there is an acute need for skilled resources to efficiently handle different stages of the EV lifecycle, including R&D, product development, etc. These challenges need to be addressed immediately to ensure the mass adoption of EVs and to see that the consumer interest in these vehicles does not start dwindling over time.
Gazing ahead, taking a sneak peek into the future, electric vehicles are bound to take the main stage in times to come. According to NITI Aayog, by 2030, 80 percent of two and three-wheelers, 40 percent of buses, and 30 to 70 percent of cars in India will be electric vehicles.
Surely, there will be knockings of innovation as we march forward, which could lead to key disruptions in the EV space. An evolved EV ecosystem would drive the change that we all are waiting to witness!
The author is Dr. Yogesh Bhatia, Managing Director and CEO, LML Electric
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