Indian Govt. Won’t Give Incentive To Automakers For Developing EVs

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Union minister Nitin Gadkari says incentives under GST are enough for automakers; confirms government’s stance on non-provision of incentives for automakers

Despite several automakers seeking incentives for developing electric vehicles, Indian government has cleared its stance on non provision of incentives to the companies. Union road, transport and highways minister Nitin Gadkari has said the incentives provided by the tax rates under the Goods and Services Tax (GST) structure are enough.

Mr. Gadkari also believes that Indian market itself will provide good incentives to the automakers as the customers are becoming aware of increasing pollution level in the country. He also says the people have become aware how cost effective EVs are. While clearing the government’s stance on incentives, the minister also revealed that the EV policy drafted by NITI Aayog is currently pending for approval by the cabinet.

Mahindra e2o Plus 2017 Green Mobility Expo Delhi 2

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Speaking about electric vehicles, Indian government is thriving to adopt zero emission pure electric mobility across the country by 2030 under its Mission EV 2030 strategy. The plan to adopt zero emission mobility is clear in the tax system as well. While electric vehicles and bio-fuel powered vehicles are taxed at 12%, petrol, diesel and hybrid vehicles are slapped with 28% GST.

Several automakers have expressed displeasure with the tax structure as they advocated for hybrid powertrain technology. According to several brands; hybrid powertrains can be used to bridge the gap between fossil fuel powered engines and battery powered electric powertrain tech. They urged the GST Council to lower tax rate for the hybrid vehicles. However, GST Council has cleared that it won’t make any such move.

tata tigor ev rolled out sanand plant 1

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Despite this turmoil, several automakers have already started working on electric vehicles for Indian market. While Mahindra already offers e-Verito, e2o Plus like cars, it is working on electric variants of KUV100 NXT and XUV500. Apart from that, Mahindra has already said it will launch electric variant of its every future SUV.

Tata Motors too is working on electric variants of Tiago, Tigor and Nano. Nissan has announced it will launch leaf EV here, while the Nissan Note e-power has been spotted testing here. Pioneer in the global EV market Tesla too is ready to launch its Model 3 electric sedan in India. Apart from that, country’s biggest carmaker Maruti Suzuki is also working on electric cars and the brand is ready to roll out its first EV here in 2020.