By Business India Editorial

India has to target making two- and three-wheelers sales 100 per cent electric in the next five years to reduce air pollution and to become a global manufacturing champion of these vehicles, said Amitabh Kant, G20 Sherpa of India.

“Public mobility is the backbone of a civilised society. Focus should be on e-buses also,” Kant said at the ‘National Dialogue on Emerging Trends in E-Mobility’, organised in New Delhi this week by the Council on Energy, Environment and Water (CEEW).

He added: “Financing will be pivotal to the e-mobility transition. There should be such mechanisms as first-loss guarantee, credit enhancement and blended finance, to enable private-capital flow at scale. India must target to install five million fast chargers, and push for battery swapping and PLIs for localised manufacturing.” 

Kant released CEEW Centre for Energy Finance’s (CEEW-CEF) independent report ‘Greening India’s Automotive Sector’ at the event. The report, supported by Bloomberg Philanthropies, showed that more electric vehicles (EVs) were sold in the country in the first six months of FY23 than in the previous full financial year. EVs constituted 6 per cent of all new auto sales in September 2022, up from only 1 per cent in January 2021. CEEW-CEF also launched its ‘Electric Mobility Dashboard’, a free, online tool that captures and dynamically updates, on a fortnightly basis, EV volumes at a national, state and RTO level.

The CEEW-CEF study also found that Uttar Pradesh leads as the state with the highest EV sales (1.65 lakh) in the country in FY22 and the first six months of FY23. It has an EV penetration of nearly 4 per cent. It was followed by Maharashtra with 1.12 lakh EV sales. However, Delhi has India’s highest EV penetration (8.30 per cent), followed by Assam (5.91 per cent). Among RTOs, Pune leads in absolute sales with 21,665 EVs sold through FY22 and the first six months of FY23, but Delhi’s Burari taxi unit is India’s greenest RTO with an EV penetration of 46.4 per cent.

Arunabha Ghosh, CEO, CEEW, said: “India's EV segment has been a bright spot for the auto sector — and growing from strength to strength. We are well-positioned to emerge as a global manufacturing hub for electric two- and three-wheelers. Announcing an official EV transition target for India's auto sector could provide an impetus to the sector’s growth, both nationally as well as sub-nationally. 

The CEEW-CEF study found that e-2Ws and e-rickshaws jointly lead the EV segment in India, forming 93.5 per cent of the total market. Nearly 3 lakh e-2Ws and 1.7 lakh e-rickshaws were sold in the first six months of FY23 alone, the highest ever recorded for both. However, despite such high numbers, the penetration of EVs among all 2Ws remains low at only 4 per cent. States like Maharashtra, Karnataka, Tamil Nadu, and Rajasthan can attribute their success in EV sales to the e-2W category. E-rickshaws form majority of EV sales in Uttar Pradesh and Tripura where they offer last-mile connectivity.

Gagan Sidhu, Director, CEEW-CEF, said: “So far, most of the EV volumes in India have been driven by e2Ws and e-rickshaws. Policy support, including at the state level, has played an instrumental role. Our report found that states with their own consumer incentives for EVs over and above FAME II subsidies recorded volume growth more than 2X that of states without such policies.