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Budget 2024: Automobile Companies Expect Government To Support EV Adoption With Subsidies
As the whole country awaits for the Budget 2024, automobile companies and enthusiasts in India are expecting significant reforms by the government to promote the adoption of electric vehicles in India.
Thanks to FAME subsidies, the government has managed to boost the adoption of electric vehicles in India by a significant margin. If this subsidy is removed, the cost of electric vehicles in India could jump substantially.
This substantial jump in the pricing of EVs could deter any consumer looking forward to buying a new electric vehicle. Furthermore, the adoption of electric vehicles has been improving steadily, especially in tier 1 cities such as Delhi, Bangalore, and Mumbai.
Given such a situation, many automakers believe that the government will not reduce or remove FAME subsidies for electric vehicles in India. Furthermore, many expect the government to continue with the current subsidy programs albeit with a few minor revisions.
Also, in order to promote the manufacturing of electric vehicle components and batteries in India, we expect the government to introduce many schemes that will benefit EV makers who try to incorporate more made-in-India components.
By introducing such schemes, the government will not only push more EV makers to invest in India, but such moves will open more job openings and also help reduce the overall production cost of electric vehicles in the country.
That being said, luxury electric vehicles are not expected to benefit from any subsidies as it will put an additional burden on the government and will not have a significant impact in terms of overall effectiveness.
On the other hand, many expect the government to reduce taxes on electric vehicles and electric vehicle components to reduce the overall production cost of an EV. This way, the government can reduce subsidies without affecting EV adoption rates.
Also, we expect the government to have a keen look into the EV charging infrastructure. This is very important as charging infrastructure will also impact the adoption of electric vehicles in the country.
Thoughts About The Upcoming Budget 2024
Many automakers are keenly relying on government subsidies to attract new EV buyers in the country. As such, reducing taxes on EV components can help EV makers reduce the overall production cost and sell the final product with a more attractive price tag.
Also, incentivizing EV makers that use made-in-India components will push more EV makers to utilise made-in-India components as well. This will also benefit the end user with the potential for a lower price tag on EV parts.
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