India’s EV Push Is A Rs Three Lakh Crore Opportunity In Next Five Years: Crisil Report

Electric vehicles (EVs) present an opportunity of almost Rs three lakh crore for various stakeholders of the industry in India in the next five years, according to Crisil limited.

The report indicates that the original equipment manufacturers (OEMs) and component manufacturers can garner about Rs 1.5 lakh crore across all EV vehicle segments.

Also, over Rs 90,000 crore in disbursements for vehicle financiers, with shared mobility and insurance accounting for the balance.

Rising fuel prices, government support with schemes such as Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME-India), Phased Manufacturing Plan, and Production Linked Incentive has played a crucial role in the surge in demand for EVs.

Data on the Vahan portal shows the share of electric three-wheelers (3Ws) increased to almost five per cent of 3Ws registered in fiscal 2022 from less than one per cent in fiscal 2018.

For electric two-wheelers (2Ws) and buses, the percentages rose to almost two per cent and four per cent, respectively.

“Start-ups with new-age business models as well as OEMs with an established business have evinced interest in manufacturing EVs. Many state governments have also provided demand incentives, and capital assistance for setting up greenfield manufacturing plants,” Crisil said in a report.

The report indicates that by 2026 adoption of electric two and three-wheelers will rise even without subsidy, due to parity of ownership cost with ICE vehicles.