The government is contemplating incentivising manufacturers to set up facilities for making lithium-ion batteries in India to lower the cost of electric vehicles, a move likely to discourage Chinese car makers seeking to enter the market.
Elaborating on the plans to develop low-cost lithium-ion batteries in India, Union heavy industry minister Anant Geete said efforts are being made to remodel the battery made by Indian Space Research Organisation so that it can be used in electric vehicles.
According to PTI, he said that the government is also mulling over incentives for domestic car makers, who invest in setting up facilities to manufacture lithium-ion batteries in India.
The government is aggressively trying to push the sales and production of electric vehicles in the country through schemes such as FAME India, which may have caught the fancy of Chinese automobile manufacturers such as BYD and SAIC who are already investing heavily in electric technology.
A 12 per cent levy on pure electric vehicles (EVs) has been proposed under the Goods and Services Tax regime, a move that reflects the government’s intention to push its adoption.
Secretary in the department of heavy industry Girish Shankar said since the lithium-ion battery is not manufactured in India and the automobile industry has to depend on imports.
With an aim to promote eco-friendly vehicles, the government had launched the FAME India scheme in 2015 offering incentives on electric and hybrid vehicles of up to Rs 29,000 for bikes and Rs 1.38 lakh for cars.