The timing could not have been more bizarre. Less than 24 hours after the curtain came down on the Delhi Auto Expo last Wednesday came the news that the Centre was shelving its grandiose plans of an electric vehicle policy.
And to think that the underlying theme of the expo was electric mobility, with manufacturers going the extra mile to showcase a range of offerings. Clearly, the idea was to keep pace with the Centre’s vision of targeting a 100 per cent electric ecosystem for the auto industry by 2030.
Never mind that this was going to be a tall order, given that there was no roadmap to make this a reality. After all, e-mobility requires supporting infrastructure: charging points, affordable batteries, clean power supply sources and fiscal sops from the government. Further, India’s achievements in this space till now have been minuscule; even this was made possible only by Mahindra & Mahindra with its e20.
So, what does the announcement imply for the auto sector? With Road Transport & Highways Minister Nitin Gadkari indicating that it is now up to manufacturers to take the lead with their e-mobility initiatives, it is logical to assume that nobody is really going to step on the gas at this point in time.
The state-run Energy Efficient Services Ltd mandate of 10,000 electric cars from Tata Motors and M&M has seen a flurry of activity in recent times, with a few hundred cars delivered thus far. Whether the balance 9,000-odd cars still need to be produced remains to be seen.
The next big development, in 2020, is scheduled to be a car jointly developed by Suzuki and Toyota Motor Corporation. With no electric policy due, will they still stick to this schedule or focus on the more pressing deadline of Bharat Stage VI emission norms in 2020?
In India, it is legislation that has driven change over the years, going back to the imposition of compressed natural gas in Delhi over 15 years ago to the Supreme Court directive last March on liquidating all BS III stocks in three days. In the absence of an electric vehicle policy, will automakers still be compelled to pull out all the stops for e-mobility?
It is intriguing why the Centre shelved its plans after all the brouhaha that accompanied its earlier intent of targeting 100 per cent by 2030. Perhaps it was an acknowledgement of the gigantic task on hand. After all, only China has shown the way ahead in e-mobility with plans to increase its use in the coming years.
Not everyone in the industry believes the issue has died a quiet death: decisions can be revoked and there is no telling if there will be a volte-face. Policymakers have been consistently adopting an aggressive tone with automakers on EVs till recently, with the message being ‘perform or perish’.
Additionally, there are concerns of the 43 per cent levy on hybrid cars (28 per cent GST + 15 per cent cess), which is a barrier to the clean air drive. Electric cars still attract the lowest at 12 per cent, but perhaps the time has come to reduce the levy on hybrids too.