Government Readies Blueprint for EV and Battery Manufacturing

The Cabinet has approved the proposal for a national mission on transformative mobility and battery storage and creation of Phased Manufacturing Program


The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the proposal for setting up a national mission on transformative mobility and battery storage initiatives.

Apart from this, the Cabinet has also approved the creation of Phased Manufacturing Program (PMP) to support the development of large-scale, export-competitive integrated batteries and cell-manufacturing giga-scale projects in India.

Phased Manufacturing Program will be valid for five years until 2024 and help in localization of production across the entire electric vehicles value chain. The program will be finalized by the national mission on transformative mobility and battery storage.

“The decisions will help in better coordination among Ministries, Departments, and Governments in ushering a transformative multi-modal mobility paradigm and will facilitate setting up of giga-scale integrated cell and battery manufacturing facilities in India,” said a government press release.

The objective of the mission is to make technology-driven sustainable and holistic mobility solutions universal by scaling up the manufacture of these vehicles.

The government has taken several initiatives to boost the adoption of electric vehicles in the recently.

The Union Cabinet also recently approved the proposal for the implementation of a program titled ‘Faster Adoption and Manufacturing of Electric Vehicles in India Phase II (FAME India Phase II)’ aimed towards the promotion of electric mobility in the country. The program has a total budget of ₹100 billion ($1.41 billion), which is expected to be deployed over a period of three years with effect from April 1, 2019. The objective of FAME is to encourage faster adoption of electric and hybrid vehicles by way of offering upfront incentives on the purchase of electric vehicles and establishing necessary charging infrastructure for electric vehicles.

Last month, the Ministry of Power also proposed a plan to develop electric vehicle infrastructure across 70 cities and 20 highways in the next five years between 2020-25 at the cost of ₹50 billion (~$700 million).

In January 2019, the Indian government lowered the customs duty on import of EV components to 10-15 percent. So far, EV components imported for assembly in India attracted the import duty of 15-30 percent. However, with this move, the assembled parts and components will now attract a duty of 15 percent and above up to 60 percent.

The Central Board of Indirect Taxes and Customs (CBIC) has created a separate category for EV components.