The Economic Advisory Council to the PM (EAC-PM) has put forward a groundbreaking proposal aimed at accelerating the adoption of electric vehicles (EVs) in India. The proposal suggests the introduction of a transferable mandate, mandating a certain percentage of vehicles manufactured to be electric.
Authored by EAC-PM chairman Bibek Debroy and Director Devi Prasad Misra, the working paper emphasizes the need for innovative policies beyond traditional subsidies and tax breaks to drive EV adoption. Despite significant growth in two- and three-wheeler EVs, the penetration of EVs in the four-wheeler segment remains low.
At present, EVs constitute only 0.21% of total vehicles in the country, with four-wheel EVs accounting for a mere 0.08% of the total. To address this, the EAC-PM proposes the introduction of transferable mandates, a move seen as an efficient way to encourage EV adoption among manufacturers.
The proposal also advocates for greater adoption of EVs in the government fleet, citing it as a means to stimulate demand and provide valuable feedback to manufacturers on user experience.
This, the paper suggests, could have a demonstrative effect on the public, further incentivizing EV adoption. Moreover, the EAC-PM highlights the economic and environmental benefits of transitioning to EVs.
With India's significant expenditure on oil imports—amounting to USD 144.2 billion in FY 2022-23—the move towards EVs could lead to a substantial reduction in the import bill. Additionally, it aligns with India's commitment to reduce carbon emissions, contributing to global climate change goals.
The proposal comes at a time when international oil prices are volatile, underscoring the need for energy security and sustainability. By leveraging advancements in battery technology and implementing supportive policies, India can position itself as a leader in electric mobility.
However, the success of such initiatives hinges on effective implementation and stakeholder collaboration. While India has announced several measures to promote EVs, the results have been mixed. Hence, there is a pressing need for concerted efforts from both the government and industry to realize the full potential of electric mobility in India.
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