Economy

Centre notifies phased manufacture programme for electric vehicles, assemblies, parts

V Rishi Kumar Hyderabad | Updated on March 07, 2019 Published on March 07, 2019

Representative image   -  Reuters

According to a representative of one of the OEMs, the move augurs well for the growth of the nascent industry having immense potential for growth

The Centre has approved a phased manufacturing programme of electric vehicles (EVs), its assemblies and parts with the objective of development of domestic manufacturing.

In a notification issued by the Union Ministry of Heavy Industries on Wednesday, the phased manufacturing of EVs is aimed at increasing the domestic value addition and creating employment opportunities. As per the plan, benefits set in from April 2020 and April 2021 onwards respectively.

The notification comes in the backdrop of the recent announcements made to encourage electric mobility and after a meeting held with at least seven Original Equipment Manufacturers (OEM) at New Delhi.

As per the proposals, it covers bus and trucks, passenger vehicles, two wheelers and three wheelers. These include in manufacture of these EVs in various modes of CBU, SKD and CKD.

According to a representative of one of the OEMs, the move augurs well for the growth of the nascent industry having immense potential for growth.

The move covers Lithium Ion cells for use in manufacture of Lithium Ion accumulator for EVs, Battery Packs for use in manufacture of EVs and covers various parts that go into manufacture of EVs. These include AC or DC charger and controller, Power Control Unit including inverter, AC/DC Converter and Condenser, Energy Monitor, Contactor, Brake System for recovery and Electric Compressor.

The Centre had approved the national Mission on Electric Mobility in 2011 and subsequently National Electric Mobility Plan 2020 in 2013. As a part of that scheme, the Department of Heavy Industry had notified Faster Adoption and Adoption and Manufacturing of (Hybid) Electric vehicles (FAME) India scheme in April 2015 to incentivise EVs.

Latter to promote electric mobility, its assemblies and parts, basic custom duty and GST were reduced and rationalised in June 2017.

In order to promote further impetus to electric mobility and promote indigenous development of electric vehicles, the Government on January 29, 2019 further reduced and rationalised basic custom duty on electric vehicles, its assembles, parts and inputs of sub-assemblies.

Following these developments, the Government had come up with the proposal for phased manufacturing roadmap keeping in view the present status of manufacturing ecosystem in the country.

As per proposals there will be graded duty structure for indigenous manufacture of electric vehicles, its assemblies and sub parts as also inputs for the sub-assemblies over a period of time.

The Government’s intends to substantially increase value addition and capacity building within the country for the electric mobility seen to have immense scope for growth.

Published on March 07, 2019
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