In its bid to accelerate electric vehicle (EV) penetration in its state, the Government of Gujarat (GoG) on 22nd June announced a new Electric Vehicle Policy 2021, which brings about a demand incentive of Rs. 10,000/KwH and is over and above any subsidies available from the central government. With this announcement, EV buyers will get a subsidy of up to INR 20,000 for electric two-wheelers, up to INR 50,000 for electric three-wheelers and up to INR 1.5lakh for 4- wheeler. Applicable during a period of four years commencing from July 01, 2021, the new EV policy targets 110,000 e2Ws, 70,000 e3Ws and 20,000 e4Ws within that timeframe. The state of Gujarat will be providing subsidies to the tune of Rs. 870 crore during the policy period.
“The new EV Policy will boost the adoption of EVs in the state and will contribute to the creation of jobs in the EV sector. The primary aim of this policy is to popularise the adoption of EVs in the country and to turn Gujarat into a hub of EV production, reduce pollution and encourage startups and bring investors in the field of e-mobility,” stated Gujarat Chief Minister Vijay Rupani while making the EV Policy announcement. Rupani added that the policy also includes incentives for setting up EV charging infrastructure.
Furthermore, subsidies will be directly transferred to the beneficiary via DBT. Any EV approved by the Gujarat RTO, whether private or commercial, shall be exempted from registration fee and will get other benefits from the FAME-II scheme of the Union government. The state policy also announced 25% capital subsidy (upto Rs 10. lakh per station) on equipment for the first 250 commercial public EV charging stations, to address infrastructure gaps in the public charging space.
Sharing his thoughts, Naveen Munjal, MD, Hero Electric said, “The revised EV policy by the state of Gujarat post the recent amendments of the central FAME policy is an excellent move which will further bridge the gap and make the switch to electric vehicles an attractive option. He also said that with this policy, the prices of Hero’s EVs will further come down making them the most affordable in the state of Gujarat when compared to pricing across the country.”
As per ICRA, the changes announced by the GoG are positive, especially for the e2W and e3W segment. Moreover, passenger vehicle for personal usage is covered under state policy, which is currently excluded from FAME II scheme. Ashish Modani, Vice President & Sector Head – Corporate Ratings, ICRA, remarked: “As per our estimates, the recent amendment by Department of Heavy Industries as well as incentive by GoG could result in price reduction of about Rs. 30,000 per e2W, which is substantial and will help in achieving price parity with conventional 2W. Another key highlight is the possible price reduction of Rs. 1.5-3 lakh for electric car buyer in Gujarat, as FAME II policy do not provide subsidy to electric cars for personal mobility.”
The subsidy for charging stations shall only be given to those developers, individuals or entities that have not availed subsidies under any other promotion schemes under the Government of India policies or schemes.
Bhavish Aggarwal, Chairman and Group CEO, Ola, “India’s EV revolution is coming. From Karnataka in 2017 to Gujarat just this week, 21 states and UTs are now incentivising EVs to make them affordable. We are committed to accelerating this with the Ola Futurefactory and our Ola scooter that’s coming soon.”
Furthermore, the Gujarat state Government will also promote charging of infrastructure with different business models and technologies. It will also encourage the swapping of batteries and charging infrastructure among private companies, distributors and investors. All housing societies and commericial establishments shall give NOC to anyone who whishes to install a charging station. The charging stations will be exempt 100% from electricity duty during the period of the policy.
Shailesh Chandra, President, Passenger Vehicle Business Unit, Tata Motors reveals, “The move by the Gujarat Government, offering incentive support for all categories of electric vehicles, clearly signals a strong resolve of the government towards cleaner environment and a sustainable future for the country. Also the support extended towards charging infrastructure will accelerate the ecosystem development and bring a greater comfort for EV buyers. We compliment the Gujarat Government for introducing such a progressive policy.”
Uday Narang, Chairman, Omega Seiki Mobility said “The revised EV policy by the Gujarat Govt. is a phenomenal move. We support this initiative and feel it’s a major step in building up the EV’s Ecosystem. The announcements lately by the centre on FAMEi II policy followed by the state Govt. giving subsidy will provide much needed boost to the EV’s and will notably make India a significant player in the EV Industry,”