SMEV directs to bring EV financing under priority sector lending
The Society of Manufacturers of Electric Vehicles (SMEV) has suggested the government consider electric vehicles for priority lending in an effort to accelerate the adoption rate and also focus on allocating enough funds for research and development in a public-private partnership mode for the development of batteries. “Unless we work seriously and diligently on EV batteries, we will end up in a situation similar to, if not worse than, our dependence on crude oil," added the body.
It said the current scenario of R&D in the EV field is extremely low, diluted and scattered and conveyed that sufficient funds in this direction with a time-bound objective will help create EV batteries that are less dependent on offshore minerals and best suited to the Indian condition. The PLI scheme for Advanced Chemistry Cell (ACC) can be suitably amended to incentivise the R&D efforts, it added.
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The budget wish list of the industry body also conveyed that there is a need to amend the PLI scheme for automobile and auto components as in its current form there is an ‘unfair price disadvantage’ for small and medium-size electric vehicle players in the industry. These incentives under the scheme are not serving the latter due to their size, turnover, and backgrounds compared to the large players. “Hence, we request the government to create a level playing field through amendments in the scheme so that MSME EV players, all the pre-existing and new players can also participate," it said.
Under the current PLI scheme for automobile and auto components, an automobile company or group firm with an India presence or global needs to have a minimum of ₹10,000 crore revenue while for auto components the minimum revenue requirement is ₹500 crore. New non-automotive investor companies or group companies, which are currently not in the automobile or auto component manufacturing business, should have a global net worth of ₹1,000 crore based on audited financial statements for the year ending March 31, 2021.
The body shared concessions on EV export should be considered to make Indian manufacturers cash in on the growing demand for EVs around the world. “Some incentives can be extended in the form of subsidies to be enjoyed by domestic consumers for exporting such vehicles to get a global stamp on electric vehicles. This is a large space that Indian industries can capture before international players invade the market with cheaper contraptions," added SMEV. It also conveyed that to promote the adoption of EVs, a citizen reward programme for EV users can be used at various establishments and occasions to access fast track services or acquire points for the rewards and inclusion of clean air campaign in the Swachh Bharat mission.
(With inputs from PTI)