2018-CGS-29: Mains Revision-17: Secondary Sector of Economy

Issues with Electric Vehicle Policy

Electric Vehicles can provide with numerous advantages in combating climate change. The governmental initiatives to give boost for the electric vehicles must move from the myopic policy driven from promoting the production of electric vehicles to building of the ecosystem so that there would be a multi dimensional approach providing for end to end support to aid in transition to have all passenger vehicles by 2030 to be electric vehicles.

Advantages of electric vehicles

Electric vehicles can address various challenges like

  • Reducing Emission Intensity: Under Paris climate deal India has committed to reduce emission intensity of its GDP by 33 to 35 per cent by 2030 from 2005 level. Electric Vehicles can aid India in accomplishing INDC by reducing emissions.
  • Reduced dependence on its imports: India is highly dependent on imports for fossil fuels. This is burdening the Current account. Switching over to electric vehicles can aid India in avoiding import dependence.
  • Make in India: India can build the industry base with its favorable demographic pattern. This will aid in development of labour intensive industries.
  • Internal combustion engines are complex with a number of moving parts. Electric vehicles are relatively simple, thus providing benefits of low maintenance.

Drawbacks of the current policy

The present policies have various lacunas like

  • Lack of focus to address the issue of providing the conductive environment for electric vehicles like building of charging points.
  • Building of consumer base: There are not many improvements in building a consumer base for electric vehicles. Without the consumer base the economy of scale cannot be achieved.
  • Addressing the raw material Issues: India is lagging behind in Hardware sector. The government has introduced Modified Special Incentive Package Scheme (M-SIPS) to build the electric manufacturing industry in the country. There is a need to link EV policy with M-SIPS to effectively aid in indigenisation and give boost to make in India.
  • Incentives to boost market for EV: There is no incentive for the automobile sellers to popularize electric vehicles who form the link between the industry and consumer.
  • Fuel for EVs: India is still facing gaps in achieving 24X7 electricity supply. Also there are transmission issues and grid management issues. The wide spread use of EVs will create burden on the grids. The infrastructure needs to be upgraded to provide a hassle free use of EVs.

India has a 2D (Demography and demand) advantage to give a boost to the electric vehicles. Therefore the policy measures needs to be broadened so that the concentration from encouraging production of electric vehicles to providing a sustainable and inclusive environment for the ease of movement of electric vehicles. In order to accommodate the concerns the government is in process of formulating a new electric vehicle policy. [Live Mint]


E-Commerce: Challenges in India and WTO Affairs

E-commerce refers to selling and buying of goods online. Increase of e-commerce can provide with benefits like formalisation of economy, fight against black money.

Challenges for e-commerce in India:

  • Infrastructure: India’s internet penetration is poor and the flagship programme of government Bharath Broadband is off-shooting its implementation timeline.
  • Digital Literacy: Indian digital literacy is abysmally low. As a result more than 70% of the population cannot access the e-commerce.
  • Financial Inclusion: Even though government spearheaded a campaign for financial inclusion under Jandhan Yojana these accounts are not listing any transactions rather they are turning into dead accounts. Lack of financial inclusion will limit the ambit of e-commerce.
  • Cyber security: Indian cyberspace is vulnerable to cyber attacks. Recently the banks recalled more than 10 lakh debit cards due to security breach. This will erode the customers affinity with e-commerce.
  • Unethical practices: e-commerce sites are resorting to unethical practices like showing false discounts to lure the customers.
  • Regulatory framework: India lacks a regulatory framework for dealings with e-commerce. The consumer protection bill 2018 is yet to get approval of parliament.

e-commerce in WTO:

India is rejecting the efforts to negotiate new global e-commerce rules under the aegis of the World Trade Organization because