India’s EV Revolution: 10 Bold Moves Driving Electric Mobility Forward

India’s electric vehicle (EV) sector is rapidly evolving, driven by government policies, rising consumer interest, and growing investments. The exemption of import duties on key EV battery components is expected to boost local manufacturing and reduce dependency on imports. While EVs accounted for just 2% of car sales in 2024, electric two-wheelers are seeing widespread adoption. Major automakers, including Tata Motors and global players like VinFast, are investing billions to expand EV production and infrastructure.

However, challenges remain, such as limited charging networks, high upfront costs, and reliance on imported raw materials like lithium and cobalt. The government aims to address these through expanded domestic battery production, financing solutions, and long-term subsidy policies like the new PM E-DRIVE scheme. State-level initiatives are also pushing for higher EV penetration, with Maharashtra and Karnataka setting ambitious electrification targets. With strategic investments, policy stability, and improved consumer awareness, India has the potential to become a global leader in electric mobility.

India’s EV Revolution: 10 Bold Moves Driving Electric Mobility Forward

India is rapidly advancing toward a future powered by electric vehicles (EVs). Recent government initiatives, such as eliminating import taxes on critical EV battery parts, aim to boost local manufacturing and reduce reliance on foreign imports. While EVs still account for only 2% of passenger car sales in 2024, electric two-wheelers are gaining momentum. To compete globally, India must pair smart policies with strategic investments in research and innovation.

Progress in India’s EV Sector

1. Surging Consumer Adoption

EV sales are rising fast, driven by government incentives, growing environmental consciousness, and better product availability. Buyers across both urban and rural regions are embracing EVs for their cost savings and sustainability benefits. Sales surged by 49% in 2023, reaching 1.52 million units. By 2030, India aims for 30% of private cars, 70% of commercial vehicles, and 80% of two- and three-wheelers to run on electricity.

2. Local Battery Production

To reduce dependence on imports, India is focusing on expanding domestic battery manufacturing. Tax incentives for battery production equipment align with the ‘Make in India’ initiative. The EV battery market, valued at $16.77 billion in 2023, is projected to grow to $27.70 billion by 2028.

3. Major Investments

Both global and domestic players are investing heavily in India’s EV sector. In 2024, Tata Motors-JLR committed $1.07 billion, Vietnam’s VinFast pledged $2 billion, and Stellantis allocated $238.7 million. Meanwhile, startups like Ather Energy secured Rs. 600 crore in funding to expand operations.

4. State-Level Strategies

Many states are implementing customized policies to drive EV adoption. Maharashtra aims for EVs to constitute 10% of new vehicle registrations by 2025, while Karnataka plans to fully electrify its cargo vehicle fleet by 2030.

5. Charging Network Expansion

A robust charging infrastructure is essential for mass EV adoption. India currently has over 12,000 public charging stations, with companies like Hyundai installing fast-charging hubs in major metro cities. However, experts estimate that India will need 400,000 new chargers annually until 2030 to meet growing demand.

6. Financing Solutions

EV financing is becoming more accessible, making ownership easier for consumers. The EV financing market is expected to reach $50 billion by 2030. In June 2024, Macquarie Group launched ‘Vertelo,’ a platform dedicated to EV fleet financing and management.

7. Institutional Adoption

Government agencies are setting an example by adopting EVs. The Indian Army introduced EVs at peace stations in early 2024, while Indian Oil opened its first battery-swapping station in Kolkata in late 2023.

Hurdles to Overcome

1. Charging Infrastructure Gaps

While major cities are seeing a rise in charging stations, smaller towns still lack adequate infrastructure. Standardizing chargers and ensuring compatibility across networks is crucial for seamless EV adoption.

2. High Upfront Costs

Despite long-term savings, EVs remain more expensive than traditional fuel-powered vehicles. Limited financing options, especially for low-income buyers, continue to hinder widespread adoption. EV penetration is expected to remain below 5% until 2025 due to these cost barriers.

3. Reliance on Imports

India currently imports 70% of its lithium-ion cells, making the sector vulnerable to global supply chain disruptions. Strengthening local production and investing in battery recycling are essential to reducing this dependency.

4. Regional Disparities

EV adoption rates vary significantly across states. Goa leads with a 14.2% EV share, while states like Uttar Pradesh have adoption rates below 5%. Uniform policies and targeted incentives are needed to bridge this gap.

5. Innovation Lag

India’s EV industry still relies heavily on imported components. However, the 2025-26 budget’s proposed duty exemptions on battery materials could encourage domestic research and innovation.

6. Consumer Awareness

Many consumers remain uncertain about EV technology, battery life, and available subsidies. While 83% of Indians are open to EVs by 2030, a significant knowledge gap exists regarding charging infrastructure and financial incentives.

7. Policy Instability

Frequent policy changes create uncertainty for both buyers and investors. The shift from FAME II to the PM E-DRIVE scheme has led to market hesitancy. A stable, long-term policy framework is essential for sustained industry growth.

Steps to Accelerate Growth

• National Charging Mission: Develop a standardized, real-time tracked charging infrastructure nationwide.
• Stable Subsidies: Introduce FAME III with clear, long-term incentives linked to consumer demand.
• Boost Battery Manufacturing: Expand incentives under the Production-Linked Incentive (PLI) scheme to enhance local production.
• Smart City Integration: Incorporate EV infrastructure into urban planning for seamless mobility solutions.
• Affordable Financing: Introduce tailored loan programs for small businesses and commercial fleet operators.
• Government Leadership: Mandate that at least 30% of government-owned fleets transition to EVs.
• Skill Development: Train workers in battery maintenance, charging station management, and EV software diagnostics.
• Support Startups: Provide incentives for startups focusing on battery efficiency and smart charging technologies.
• Awareness Campaigns: Launch large-scale educational initiatives to inform consumers about EV benefits, subsidies, and charging options.

The Road Ahead

India’s EV industry is witnessing rapid progress, driven by strong policy support, strategic investments, and shifting consumer preferences. While challenges such as high costs, infrastructure limitations, and supply chain vulnerabilities persist, the right measures—including boosting domestic manufacturing, stabilizing policies, and fostering innovation—can position India as a global leader in electric mobility. By integrating EV adoption with broader sustainability goals, India can pave the way for a cleaner, more efficient future in transportation.