India: State Level EV Policies

Overview

This page contains proposed or adopted state-level electric vehicle policies in India. These policies are complementary to national- and city-level policies that aim to promote India’s transition from internal combustion engine vehicles to electric vehicles. The objectives of these policies vary by state but commonly include improved air quality, climate change mitigation, reduced dependence on oil imports, and the development of India’s electric vehicle industry.

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India Zero-emission vehicles

Introduction

Targets: India’s state-level EV policies vary in scope, but most address electrification across multiple vehicle classes. Sales share and new vehicle registration targets are commonly set for 2-, 3-, and 4-wheel passenger vehicles. In contrast, stock share and purchase targets are set for public fleets like government vehicles and transit buses.

Demand-side policies: Capital subsidies are one of the most common demand-side tools in state-level policies, with some states like Gujarat and Assam providing flat subsidies for the purchase of all new electric 2W, 3W, and 4W vehicles, while others like Odisha and Kerala provide subsidies that are a percentage of the EV’s purchase price. Some programs, such as Assam’s incentive for early 2W and 3W, base the subsidy on the vehicle battery capacity. “Early-bird” subsidy programs like the one in place in Maharashtra only subsidize the first 100,000 EV purchases.

Other common incentives include exemptions from or reductions to vehicle registration fees, road taxes, parking charges, and occasionally, vehicle purchase taxes. To convert its large 3w vehicle fleet, Delhi has adopted a scrappage program that allows owners of internal combustion engine rickshaws to scrap their old vehicles for a credit towards purchasing an electric one.

Supply-side policies: A core component of many state-level EV policies is the provision of incentives and capital subsidies for EV manufacturing, research, and development. Some governments establish tax breaks for purchasing land used in the construction of EV manufacturing facilities, exempt EV manufacturers from stamp and electricity duties, and provide utilities at a reduced rate.

Charging infrastructure: Indian states provide a variety of incentives for private EV charger installations and establish targets for installing public chargers in densely populated areas and at regular intervals on high-traffic roads. Many policies change their state’s zoning laws, setting charging infrastructure requirements for constructing large-scale commercial complexes and residential buildings.

Several states have invested in battery-swapping kiosks to promote the transition to electric 2- and 3-wheeled vehicles in the ridesharing and delivery sectors.

States with proposed or adopted EV policies

Electric vehicle guidebook for Indian states

To assist state-level policymakers in designing well-rounded electric vehicle policy packages, the ICCT developed a guidebook (2019) that identifies and summarizes international best practices in promoting electric vehicles.

 

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