Will India Miss the EV Train As Well?

India is facing an increasing demand for power thanks to its rising population and consumerism. As such, the government is trying very hard to make the country energy independent. It has set an ambitious renewable energy installation target that will not only reduce the country’s dependence upon grid power but also help to conserve the environment. But, despite huge government support and a large unemployed working force, the country missed the clean energy train. This was because India lacked the sophisticated manufacturing facilities and failed to combat China’s rising global footprint.

We had hoped that the country was on time to catch the EV train as India is poised to become one of the largest EV markets in the world. The government devised meaningful targets and policies in time, to support mass EV adoption in the country. This coupled with rising air pollution levels, especially in leading Indian cities acted as strong tailwinds for EVs in India. However, there is some bad news on the radar. Due to lack of demand, state-run Energy Efficiency Services Ltd (EESL) is planning to curb the sourcing of EVs to less than a third of the 10,000 cars it had originally tendered. EESL had entered into an EV sourcing contract with Tata Motors and Mahindra and Mahindra in September 2017. These EVs were to be used by the government and its agencies, who use approximately 5,00,000 cars in all.

Out of this, only 1500 EVs have been supplied so far, and EESL plans to place a final order of around 3,000 vehicles by March 2020. The original tender had a clause that while 10,000 units were the total allocation, vendors will only manufacture after an increase in demand. Other than a slowdown in passenger vehicle sales, policy changes in Telangana practically reversed the momentum gained so far in the Indian clean energy sector. Other than these, senior government officials refused to use the EVs citing poor performance and low mileage. Under the National Electric Mobility Mission Plan 2020, the government is targeting six million electric and hybrid vehicles in India by 2020. EESL plans to set up more than 1,000 charging stations in India to support these cars.

“I don’t think this EV procurement plan will continue going forward and maybe after March 2020, EESL will close the tender. In the tender it was mentioned that while 10,000 units was the overall allocation, vendors will only manufacture after a demand for the same was raised,” said a person aware of EESL’s strategy.

Source: Live Mint