What government needs to do to promote electric cars

A recent report that the Centre plans to scrap cash incentives currently available to buyers of electric cars despite the government's overall objective of incentivising these clean fuel technologies may not augur well for promoting sales of these vehicles and consequently a cleaner environment. The news is especially bad for metro cities.

While incentives for the purchase of electric buses and two-wheelers are sure to continue there is a talk of the same for e-buses to be brought down to 40 per cent from the existing 60 per cent.

The main logic behind the turnaround is reported to be government's preference to continue allowing cash subsidies for electric vehicles used by shared-mobility operators such as Ola and Uber as these vehicles alone are expected to offer a much higher mileage than the privately owned cars.

If this is the sole logic, the level of incentives for buses too needs to be retained at a level higher than 40 per cent — these being the main source of public transport covering seat-load of as many 10 cars per bus and even more, almost double for the double-deckers.

The government seems to have firmed up its view that cash incentives for private electric vehicles need to be withdrawn as it neither makes a "substantial difference in promoting sales nor serves the purpose of a clean environment".

Under the existing arrangement, the government offers a discount of up to Rs 1.3 lakh on an electric car as part of its clean-energy programme, FAME (faster adoption and manufacturing of hybrid and electric vehicles).

This is being proposed to be rescinded from the new FAME Phase 2 draft policy drawn up by the heavy industries ministry.

The government feels that the addition of cab aggregators like Ola and Uber to the list of subsidy beneficiaries would prompt these companies to go for electric cars, which definitely offer far higher economy of driving costs as compared with that offered by the other conventional diesel/petrol or CNG driven vehicles alternatives.

The turnaround seems to run contrary to the broader mobility vision that the government has been projecting in the past.

Considering the steep rise in levels of vehicular pollution — both due to increasing number of vehicles as well as the emission levels of the fuel in use — the government had been rightly contemplating to target shifting the entire car industry in India to switch to electric engines by 2030.

Readers are aware that during the last year alone, around 1,500 electric passenger vehicles have been sold against petrol/diesel/CNG car sales of 32 lakh.

This vision had found favour and support with both the former power minister Piyush Goyal (now in-charge of railways and finance), and the road transport and highways minister Nitin Gadkari. Car companies and their manufacturers' association, Society of Indian Automobile Manufactures (SIAM) has, however, been pleading with the government for a more cosy transition.

In my opinion, keeping in view the surge in population and increase in density of vehicles, whether driven privately or by the likes of Ola and Uber, the government actually needs to come out with an out of box national commutation policy which should encourage the in-city and intra-tertiary cities travel by public transport systems such as rapid metro, metro, public e-buses and private vehicles used as pooled cars.

To make this successful, all private cars that ferry at least four people, must be allowed first preference, even free parking and zero toll charge.

Also read: Why US and UK will soon lose favour as preferred destination for Indian students