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The Indian government seems to be taking strong measures to counter pollution and promote electric vehicles. The government might ban the sales all petrol, diesel and CNG powered three wheelers from April 2023 and all petrol-powered two-wheelers under 150cc from April 2025.
If approved, this will be a landmark law and could promote electric vehicles at the cost of destroying the existing two-wheeler industry in India. A report by Autocar states that the Inter-Ministerial Steering Committee of the National Mission for Transformative Mobility and Battery Storage recently had a meeting.
According to the report, the high-level panel in the meeting sought to ban the sales of two wheelers under 150cc from April 2025 and the fossil-fueled three wheelers from April 2023. The nearest sought mandate for three wheelers is still four years away, but would the Indian market warm up to the idea of electric vehicle by then?
It is no secret that electric vehicles are the future and the electric vehicle industry has seen rapidly growth in the last couple of years. More start-ups are coming up in the space and more mainstream manufacturers also are trying to step in with their electric vehicles.
This is especially true in the two wheeler segment. People have begun to understand that electric vehicles are the future and manufacturers have understood that electric two wheelers are the only way they would be able to stay afloat.
Manufacturers like Ather Energy have proven that electric vehicles do not necessarily have to be boring and of a low quality. However, it would have an adverse effect on the number of jobs in the industry and also on the number of manufacturers that depend on the sales of fossil-fueled vehicles for their sales.
Around 2.10 crore two-wheelers were sold in the FY2018-2019 and 88 percent (1.84 crore) of the two wheelers sold were under the 150cc mark. The question to be asked is if all the 1.84 crore buyers are ready to switch to electric vehicles and how many of them will be ready by April 2025, which is when the government plans to ban these vehicles.
Secondly, the three-wheeler industry in India hasn't even begun warming-up to the idea that the future is electric. Players like Mahindra Electric have launched electric three-wheelers in the Indian market, but they are barely able to find any takers for them because of the way these vehicles are used in India.
Three-wheeler operators - be it cargo or passenger – cannot afford a lot of downtime as downtime simply means, loss of profit. With electric vehicles, they will have a lot of downtime thanks to the time required to charge up the batteries.
These are some of the problems in the real-world that the government must think of before blatantly putting out an order that fossil-fueled vehicles of a particular segment must be banned. However, the meeting also reportedly brought out some good initiatives from the government.
The high-level panel plans to double the incentive on purchase of an electric vehicle from Rs 10,000/kWh to Rs 20,000/kWh. Adding to this is a scrapping policy for fossil-fueled vehicles that will be linked to electric vehicles just like in a few developed european countries.
Under this plan, if one decides to scrap their petrol.diesel vehicle in favour of buying a brand new electric vehicle, they would be liable to receive lots of benefits and incentives. Alongside this, the government is also planning to tighten the noose on fossil-fueled vehicles by implementing extra taxes and fees on such vehicles for causing more pollution. All these measure might just boost the growth of the electric vehicle industry in India.
Thoughts On Ban Of Two Wheelers Under 150cc From April 2025
The government is certainly ambitious with its plan to promote electric vehicles. However, the deadline being set for that might be a little too tight and might disrupt things in the automotive industry which is one of the largest contributors to the economy. Will the manufacturers take the pressure or will they buck under the pressure is something that remains to be seen.