EVs no longer need subsidies, Indian Minister says

NEW DELHI: India no longer needs to subsidize electric vehicles as falling battery costs make them increasingly competitive, Federal Road Minister Nitin Gadkari said.

"Demand has increased, volume has increased and cost has reduced,” Gadkari said at the annual BNEF Summit in New Delhi on Thursday. "I feel we don’t need subsidy.”

He said the cost of lithium ion batteries has fallen to $107 per kilowatt-hour and is on track to hit $90, a price that can avoid the need for subsidies, and indicates the market is mature.

Electric vehicles in India are taxed at 5% while diesel and petrol cars can attract rates as high as 48%, Gadkari added.

His comments come after local media reported on Wednesday that the government will soon roll out fresh incentives to boost adoption of EVs, citing Heavy Industries Minister HD Kumaraswamy.

Electric scooter and bike sales in India grew 40% last year and electric car registrations were up 70% year-on-year thanks to subsidies, according to the International Energy Agency’s global EV outlook report.

That compared with less than 10% growth for total car sales.