NITI Aayog Report on India’s Electric Vehicle Market
India is rapidly advancing its electric vehicle (EV) sector with a vision to capture a 30% share of EV sales by 2030. The recent report by NITI Aayog titled ‘Unlocking a $200 Billion Opportunity – Electric Vehicles in India’ presents an in-depth analysis of the challenges and potential solutions to accelerate this transition. This document offers a strategic blueprint to boost EV adoption, enhance manufacturing, and reduce carbon emissions, aligning with India’s clean mobility goals.
Current EV Market Growth
- India’s EV sales surged from 50,000 units in 2016 to 2.08 million in 2024.
- The EV share in total vehicle sales rose from 0.5% in 2018 to 7.7% in 2024.
- Despite slower initial growth compared to global trends, India’s EV penetration has improved , reaching over 40% of global penetration by 2024.
- Over 6.5 million EVs now operate on Indian roads with 1.2 million new registrations in 2024 alone.
Economic and Environmental Impact
The EV sector could unlock a $200 billion market by 2035. This expansion promises over 10 million jobs across manufacturing, servicing, and recycling. It would also reduce India’s oil import bill by ₹3.7 lakh crore and cut carbon emissions by 839 million tonnes of CO₂ equivalent. EV adoption supports India’s energy security and climate commitments.
Infrastructure and Policy Landscape
India currently has 25,000 public EV chargers but needs 2.9 million by 2035 to meet demand. Twenty-nine states have notified EV policies with four more drafting plans. However, policy fragmentation and uneven infrastructure distribution remain challenges, especially in rural and Tier-2 cities.
Key Barriers to EV Adoption
High upfront costs due to expensive batteries limit mass adoption. Financing is scarce, particularly for informal sector buyers and MSMEs. Charging infrastructure is concentrated in urban areas, leaving many regions underserved. Battery recycling and local component manufacturing are underdeveloped. Policy inconsistency across states creates uncertainty for investors.
Strategic Unlocks for Accelerated Transition
- Stable Policy Architecture: Harmonised national and state-level policies to reduce investor risk.
- Low-Cost Financing: Affordable green loans and credit insurance to widen EV access.
- Ecosystem Development: Building full value chains including battery production and recycling.
- Public Charging Expansion: Scaling up to 2.9 million chargers by 2035.
- Demand Incentives: Subsidies, tax benefits, and carbon credits to lower buyer costs.
Future Directions and Recommendations
NITI Aayog advocates for a ‘Mission EV@30’ under Cabinet oversight with cross-ministry coordination. Localising battery production and securing critical minerals is crucial. A unified Green Transport Fund could finance infrastructure and subsidies. Expanding the EV Readiness Index will promote state-level competition. Finally, a just transition strategy will retrain workers from the internal combustion engine sector for EV roles.
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