EV Penetration Slows, India Faces Challenge to Hit 2030 Target
ECONOMY & POLICY

EV Penetration Slows, India Faces Challenge to Hit 2030 Target

India’s electric vehicle (EV) adoption has grown at an annual rate of approximately 200 basis points (bps) between FY21 and FY24, but this growth rate needs to increase to 380 bps per year to meet the national target of 30% EV adoption by 2030, according to a report by FICCI-YES BANK. The report, titled “Driving ZEV Transition – From Center to State,” emphasizes that the current pace of growth is insufficient to achieve the ambitious EV30@30 target and calls for more aggressive policy interventions at both state and central levels.

While EV adoption is gaining momentum, with states like Delhi (11.5%), Kerala (11.1%), and Assam (10%) leading the charge, the report notes that five states accounted for over 50% of EV sales in FY24, revealing regional disparities. States such as Gujarat, Odisha, Kerala, and Punjab showed the highest compound annual growth rates (CAGR) between FY21 and FY24, underscoring these disparities.

The report also highlights that many state EV policies are nearing their expiration, which could undermine investor confidence and policy continuity. It calls for an urgent review and renewal of these policies until 2030 to provide a stable framework for the EV ecosystem and align the efforts of states and the central government toward achieving decarbonization goals.

To accelerate EV adoption, the report recommends integrating EVs into public transport systems, such as state-run buses and government fleet operations, including waste management fleets. It also stresses the need for continued fiscal incentives like road tax exemptions to encourage consumer adoption.

On the supply side, the report urges greater localization of EV manufacturing, including assembly processes and value chain development, to reduce reliance on imports. It also calls for investments in research and development, workforce skilling, and sustainability measures to build a robust EV ecosystem. Infrastructure is flagged as a critical area, with a phased approach to deploying EV charging stations in Tier-2 cities, rural areas, and along highways. The report emphasizes the importance of real-time monitoring and maintenance of charging stations to ensure their reliability and build consumer confidence.

The transport sector, which is a major contributor to India’s emissions, is central to the country’s net-zero commitment by 2070. While central policies provide a strong foundation, the report stresses the need for states to align their strategies with national goals. It recommends establishing dedicated EV coordination agencies at the state level to ensure effective implementation and regular progress reviews.The report concludes that achieving India’s EV targets requires a collaborative effort between the central government and states, with a focus on policy, infrastructure, and awareness-building to ensure a successful transition to zero-emission vehicles.

India’s electric vehicle (EV) adoption has grown at an annual rate of approximately 200 basis points (bps) between FY21 and FY24, but this growth rate needs to increase to 380 bps per year to meet the national target of 30% EV adoption by 2030, according to a report by FICCI-YES BANK. The report, titled “Driving ZEV Transition – From Center to State,” emphasizes that the current pace of growth is insufficient to achieve the ambitious EV30@30 target and calls for more aggressive policy interventions at both state and central levels. While EV adoption is gaining momentum, with states like Delhi (11.5%), Kerala (11.1%), and Assam (10%) leading the charge, the report notes that five states accounted for over 50% of EV sales in FY24, revealing regional disparities. States such as Gujarat, Odisha, Kerala, and Punjab showed the highest compound annual growth rates (CAGR) between FY21 and FY24, underscoring these disparities. The report also highlights that many state EV policies are nearing their expiration, which could undermine investor confidence and policy continuity. It calls for an urgent review and renewal of these policies until 2030 to provide a stable framework for the EV ecosystem and align the efforts of states and the central government toward achieving decarbonization goals. To accelerate EV adoption, the report recommends integrating EVs into public transport systems, such as state-run buses and government fleet operations, including waste management fleets. It also stresses the need for continued fiscal incentives like road tax exemptions to encourage consumer adoption. On the supply side, the report urges greater localization of EV manufacturing, including assembly processes and value chain development, to reduce reliance on imports. It also calls for investments in research and development, workforce skilling, and sustainability measures to build a robust EV ecosystem. Infrastructure is flagged as a critical area, with a phased approach to deploying EV charging stations in Tier-2 cities, rural areas, and along highways. The report emphasizes the importance of real-time monitoring and maintenance of charging stations to ensure their reliability and build consumer confidence. The transport sector, which is a major contributor to India’s emissions, is central to the country’s net-zero commitment by 2070. While central policies provide a strong foundation, the report stresses the need for states to align their strategies with national goals. It recommends establishing dedicated EV coordination agencies at the state level to ensure effective implementation and regular progress reviews.The report concludes that achieving India’s EV targets requires a collaborative effort between the central government and states, with a focus on policy, infrastructure, and awareness-building to ensure a successful transition to zero-emission vehicles.

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