Is India making a play for the electric vehicle market?


There are very few people who do not recognise the potential for enormous growth in the electric vehicle market. We have governments around the world falling over themselves to announce generous packages, incentivise consumers, and also support car manufacturers to ensure future job creation. However over the last few days there has been a general feeling that the Indian government is now looking to be more proactive than ever before with regards to consumers and car manufacturers.

Could India be the next centre of excellence for electric vehicles?

One problem with regards to the Indian government is the fact that time and time again, from 2010 onwards, they are promised assistance to consumers and manufacturers looking towards the electric vehicle market. The reality is that this assistance never materialised in the form in which it was promised and indeed a number of the financial incentives were almost immediately withdrawn from the market place. So what's different this time?

Car manufacturing is a very small part of the Indian economy, with areas such as Asia, America and Europe very prominent in this particular field. However, the introduction of electric vehicles has given the Indian government food for thought amid the potential to take a large chunk of this sector over the coming years. So what is the Indian government proposing?

Financial incentives, revisited!

There is scepticism at this moment in time with regards to the Indian government’s policy towards electric vehicles and various financial incentives. We have been here, we have bought the T-shirt, and the incentives very quickly disappeared after the headlines began to die down. However, there is an understanding amongst the Indian business arena that the government is more determined and has more funding behind it than historically.

The only real way to incentivise the industry is to ensure that car manufacturers receive as much financial assistance as possible, trading relations are agreed with other countries and indeed consumers are giving assistance, in order to give the sector an initial boost. If the government is able to deliver hundreds of millions of dollars in incentives starting at the manufacturing phase and ending at the purchase phase, what is the potential?

Building bridges for the future

The fact that many of the world's largest car manufacturers are based in Asia, America, and Europe does give them something of a head start on Indian counterparts. However, the Indian population is enormous, and assuming that vehicles of a sufficient standard can be created within India, then not only is there potential to export these but there is also an absolutely enormous domestic market!

Any success in the domestic market will ultimately be replicated overseas because Indian consumers are very choosy about the products they purchase, especially bearing in mind the recent economic growth. The domestic market place will be an interesting test bed for the Indian electric vehicle offering and not only is there enormous potential for car manufacturers and consumers but large scale tax income streams could be created for the government further down the line.


While the Indian car manufacturing industry has never really registered on the worldwide stage, there is the potential to create a significant presence within the future electric vehicle market. This is an area of industry which is relatively untested, a sector which is still relatively infant, and due to the reluctance of some car manufacturers to fully incorporate electric vehicle technology into their future products, there may well be a gap in the market.

The sector will only really reach critical mass if the authorities are financially and practically supportive although the problem is that historic promises with regards to electric vehicle manufacturing never seemed to materialise. Will this time be different?