Cabinet to review mission plan for electric and hybrid vehicles

The government is expected to announce a national mission plan for electric and hybrid vehicles during the budget session of Parliament as it seeks to promote their use and reduce the dependence on fossil fuels.

The department of heavy in- dustries has sent the proposal to cabinet after obtaining ap- proval from all ministries con- cerned, said Ambuj Sharma, joint secretary, department of heavy industries (DHI). “We expect to get the clearance in this session.“

Under the proposal, the gov- ernment will set up a minister- level national council for elec- tric vehicles headed by heavy industries minister Praful Pa- tel. There will be a secretary level board to ensure unifor- mity of regulations across all states.

India currently lacks an in- frastructure that can support electric vehicles, given the na- tion's power shortage and the inability to provide assured supplies.

The policy is aimed at re- moving hurdles such as the need to obtain the consent of all concerned ministries for various measures, said a DHI official on condition of ano- nymity. Setting up a charging station, for instance, requires the approval of the roads and power ministries among oth- ers, he said.

“The idea is to have a strong political will to implement a uniform tax structure and in- frastructure plans across the country,“ the official said. “We want to see at least eight lakh EVs (electric vehicles) on Indi- an roads by 2015. We will in- troduce it as a pilot project in some of the major cities.“

DHI had circulated a draft notice last year among minis- tries such as power, finance, road transport, new and re- newable energy and urban de- velopment.

Tax incentives may be used to promote the vehicles, Shar- ma said. “There are plans to set up R&D (research and de- velopment) centres and charg- ing points,“ he said.

In November, the ministry of new and renewable energy of- fered incentives to electric ve- hicle makers in the current and the next fiscal years to boost sales of the vehicles.

Delhi provides the highest incentive with a rebate on val- ue added tax amounting to a 29.5% reduction in price.

Unless prices can be brought on par with conventional vehi- cles, there isn't going to be any significant impact on sales, said Jatin Chawla, auto analyst with Mumbai-based brokerage firm India Infoline Ltd.

The ex-factory price of elec- tric two-wheelers ranges from `26,000 to `43,000, while elec- tric cars made by Mahindra Reva Electric Vehicles Pvt. Ltd, India's only maker of such ve- hicles, start at `3.5 lakh.

Around 85,000 electric vehi- cles were sold in the country in 2009-10, according to lobby group the Society of Manufac- turers of Electric Vehicles.
Sharma said overseas manu- facturers want to enter the In- dian market once a basic infra- structure is created here.