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The Union Government has approved a scheme aimed at promoting India as a manufacturing destination for e-vehicles (EVs) with the latest technology.
The policy aims to attract investments from reputed global EV manufacturers to bolster the EV ecosystem in the country.

About E- Vehicle Manufacturing Policy

Access to Latest Technology: Indian consumers will gain access to the latest technology in EVs, aligning with the Make in India initiative.
Strengthening the EV Ecosystem: The policy aims to strengthen the EV ecosystem by fostering healthy competition among EV players, leading to high-volume production and economies of scale.
Reducing Import Dependency: By promoting domestic production, the policy aims to reduce imports of crude oil, lower the trade deficit, and curb air pollution, particularly in cities.
Key provisions of the Policy include:

Minimum Investment Requirement: A minimum investment of Rs 4150 crore (∼USD 500 million) is required to qualify for the scheme.
Timeline for Manufacturing: Manufacturers must set up manufacturing facilities in India within 3 years, start commercial production of e-vehicles, and achieve 50% domestic value addition (DVA) within 5 years.
Domestic Value Addition (DVA): Localization levels of 25% by the 3rd year and 50% by the 5th year must be achieved during manufacturing.
Customs Duty Incentives: A customs duty of 15% applies to vehicles with a minimum CIF value of USD 35,000 and above, subject to certain conditions.

Limit on Duty Forgone: The duty foregone on imported EVs is limited to the investment made or ₹6484 crore, whichever is lower.
Annual Import Limits: A maximum of 40,000 EVs can be imported annually, subject to investment thresholds.
Bank Guarantee Requirement: Investment commitments must be backed by a bank guarantee, which will be invoked in case of non-achievement of DVA and minimum investment criteria.
Bank Guarantee Invocation: The bank guarantee will be invoked if companies fail to meet the DVA and minimum investment criteria outlined in the scheme guidelines.

FAME scheme II (2019): Offers incentives such as subsidies, tax rebates, and preferential financing for EV manufacturers and buyers.
National Electric Mobility Mission Plan (2013): Aims to achieve annual sales targets of 6-7 million hybrid and electric vehicles by 2020 through fiscal incentives.
Amendments to the Model Building Bye-laws (2016): It requires 20% of parking spaces in residential and commercial buildings to be allocated for EV charging facilities.
National Mission on Transformative Mobility and Battery Storage (2019): Aims to create an ecosystem for EV adoption and support the establishment of large-scale battery manufacturing plants.
Production Linked Incentive (PLI) scheme (2021): It incentivises EV and component manufacturing.
Vehicle Scrappage Policy (2021): It incentivizes the scrapping of old vehicles and the purchase of new EVs.
Ministry of Power’s guidelines: It mandates charging stations every 3 km along grids and every 25 km on highways.

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