India’s efforts to attract foreign electric vehicle (EV) giants like Tesla have yielded limited results. Large-scale investment commitments were sought in exchange for import duty waivers, but with Tesla’s declining sales and rising competition, these plans seem stalled. It’s time to prioritize and nurture homegrown EV startups brimming with innovation.
Indian startups have displayed a remarkable ability to develop unique solutions within the EV ecosystem. Bengaluru-based GPS-Renewables, for instance, has created a biogas-powered EV charging station, promoting a completely green EV experience.
Exponent Energy, another Indian startup, boasts rapid charging technology, claiming to fully charge an EV in just 15 minutes. These are just a few examples highlighting the potential of Indian innovation.
Current policy structures, however, inadvertently create roadblocks for these promising startups. The Performance Linked Incentive (PLI) scheme for automobiles, designed to incentivize large-scale manufacturing, exemplifies this challenge.
The PLI Auto Champion OEM Scheme sets a minimum threshold of ₹10,000 crore in global group revenue and ₹3,000 crore in prior fixed-asset investment for participation. This effectively excludes smaller, innovative startups.
Lowering eligibility requirements within the PLI scheme would significantly improve its reach and impact. China’s approach serves as a useful model. There, startups can qualify for manufacturing incentives based on factors beyond just investment size, such as the number of EVs produced.
Additionally, China exempts EV manufacturers from consumption taxes, reducing production costs and promoting domestic manufacturing with Chinese batteries. A similar approach in India could incentivize local production and innovation.
While attracting large-scale investments holds value, fostering an environment that encourages domestic innovation and production is equally important. Indian entrepreneurs and innovators are the nation’s most valuable assets, and their success should be prioritized.
Reference- Koan Advisory, Hindustan Times story, Mercom India, Inside EVs, Clean Technica