India’s Electric Mobility Road Ahead: A Greener Future?

A Collective, Global Charge

Around the globe, governments are stepping up their game to promote electric mobility. The European Union, for instance, aims to have at least 30 million zero-emission vehicles on its roads by 2030.

This ambitious target is part of its Sustainable and Smart Mobility Strategy, and is backed by substantial investments in charging infrastructure and incentives for consumers.

The EU has allocated over €14 billion from its Connecting Europe Facility for transport to support more than 500 projects designed to facilitate the shift to electric mobility. (see figures 1, 2, 3)

India currently sees EVs accounting for only 2 per cent of its overall vehicle market.

However, the government is not lagging behind in policy measures; it is actively supporting the domestic manufacturing of EV components through its Production Linked Incentives (PLI) scheme, which aims to foster a circular economy for battery recycling, providing a stable supply of essential raw materials and tax benefits to enhance the profitability of lithium-ion batteries — the most expensive component of EVs (The Secretariat). 

Battery technology is also experiencing a renaissance. Innovations like solid-state batteries promise to extend the range and safety of EVs, while significantly reducing charging times.

According to the International Energy Agency’s 2022 Global EV Outlook, these advancements are crucial for accelerating EV adoption.

As we look ahead, the potential for increased range across various vehicle segments is promising, as evidenced by the increased range of different segments of vehicles (see figure 4).

Moreover, the trend toward shared mobility is gaining momentum. The rise of e-hailing services has been astounding, with trips increasing from 5.5 trillion in 2016 to 16.5 trillion in 2019.

Cities are increasingly focused on reducing the use of private vehicles, with over 150 cities implementing measures to promote flexible, shared and sustainable transportation options.

India’s Electric Mobility Narrative

In India, the electric mobility landscape is evolving, driven by government policies and burgeoning market demand. The National Electric Mobility Mission Plan (NEMMP) aims for a significant uptick in EV adoption, fostering local manufacturing and innovation.

This initiative is not just a commitment; it’s India’s strategy to position itself as a key player in the global EV market.

The FAME India scheme — an acronym for Faster Adoption and Manufacturing of Hybrid and Electric Vehicles — has been pivotal in providing financial incentives for consumers and manufacturers alike.

It encourages the development of charging infrastructure and promotes EV sales. Recent Ministry of Heavy Industries data reveals that India has sold 15.77 lakh EVs, sanctioned 7,210 electric buses and approved 9,441 charging stations. (see chart extrapolated from Vahan portal data)

Expectedly, electric two-wheelers have dominated the landscape, accounting for nearly 60 per cent of total EV sales, propelled by companies like Ola Electric, Hero Electric and Ather Energy.

While the sales of four-wheelers have seen some dips, the three-wheeler and bus segments are on an upward trajectory, which is promising for shared mobility systems.

Collaborations between EV manufacturers and ride-hailing services are expanding the reach of electric fleets, suggesting that by 2025, around 30 per cent of ride-hailing services in major cities could be electric, and by 2030, 90 per cent of all ride-hailing vehicles will be EVs (Niti Aayog). 

Aparna Vijaykumar, programme manager for electric mobility at World Resources Institute (WRI) India, highlighted a significant breakthrough in India's electric bus landscape.

She stated, “The successful bulk procurement strategy initiated through the Grand Challenge, which launched the world’s largest electric bus tender for 5,500 units, was a pioneering approach that has refined the purchasing process using an OPEX (operational expenditure) model, leading to reduced costs and showcasing the power of economies of scale — a lesson drawn from sectors like street LED lamps."

Vijaykumar's point was that as a result, the Grand Challenge has paved the way for the National Electric Bus Programme, targeting 50,000 buses.

This innovative business model, combined with government incentives, has solidified the deployment of electric buses in India and sets a vital precedent.

It’s time for fleet operators in the electric two/four-wheeler and micro-mobility sectors to adopt these strategies, as India has the chance to lead the world in utilising innovative financing to electrify public transport.

The PLI Scheme: A Game Changer

The Indian government’s PLI scheme is revolutionising the battery recycling landscape, aiming to enhance domestic manufacturing and reduce reliance on imports.

With an impressive allocation of Rs 18,100 crore (approximately US$ 2.4 billion) to achieve 50 GWh (gigawatt hour) manufacturing capacity, the scheme incentivises companies with a generous 13-15% on annual sales value of locally produced EVs.

It has spurred significant investments from industry stalwarts like Tata Chemicals, Amara Raja Batteries and Exide Industries. Furthermore, international giants like LG Chem and Samsung are eyeing opportunities in this burgeoning market, underscoring India's potential to become a global hub for lithium-ion battery manufacturing.

Startup Surge

Electric vehicle startups are crucial to expanding India's electric mobility ecosystem. Companies such as Ola Electric and Ather Energy are leading the charge in the two-wheeler segment, with Ola reporting remarkable sales of over 1 lakh scooters shortly after launch.

Ather is focusing on building a robust network of charging stations, aiming at 1,000 operational stations by 2024. These efforts are not just about increasing accessibility; they also address consumer concerns regarding charging infrastructure, promoting wider adoption of EVs.

Moreover, startups like Tork Motors and Yulu are increasing diversification. While Tork Motors is developing electric motorcycles, having secured over Rs 100 crore in funding to scale production, Yulu tackles urban mobility challenges with its fleet of over 1,000 electric bicycles in cities like Bengaluru.

These startups are enhancing the range of electric options and fostering a culture of innovation and entrepreneurship, significantly contributing to the government's vision of a sustainable transportation ecosystem.

Road to Sustainability

Electric mobility is more than just a shift in transportation; it represents a transformative change in how we think about mobility.

Both global and Indian trends emphasise that transitioning to EVs is not merely an environmental imperative, but a golden economic opportunity. By embracing these trends and investing in innovative projects, countries and businesses can pave the way for a sustainable future.

Collaborations between governments, industry leaders and consumers will be pivotal for the success of electric mobility.

With the right policies and investments, not only can we meet our climate goals, but also create a cleaner, more efficient transportation system for generations to come.

The road ahead is electric, and it's time to accelerate our journey toward a sustainable future. Together, let's charge forward into a cleaner, greener tomorrow.

(The author is a public policy and urban transportation enthusiast and specialist. Views expressed are personal)