EV Policies

Policies Snapshot Table

Policy / Scheme	Budget / Incentive	Objective	Key Impact
Key Impact	₹10,900 Cr	Accelerate EV adoption	Vehicle subsidies & charging infrastructure
GST on EVs	5%	Reduce ownership cost	Lower than 28% GST on ICE vehicles
Section 80EEB	₹1.5 Lakh Tax Deduction	Encourage EV financing	Tax benefit on EV loan interest
PLI Auto Scheme	₹25,938 Cr	Domestic EV manufacturing	Localize EV ecosystem
ACC Battery PLI	₹18,100 Cr	Battery manufacturing	Reduce battery imports
Delhi EV Policy 2.0	Up to ₹1 Lakh Incentive	Boost EV adoption	Road tax & registration fee exemption

India’s Electric Vehicle (EV) policy framework is supported by significant financial commitments and measurable adoption targets. Under the PM E-DRIVE Scheme (2024–2026), the government has allocated approximately ₹10,900 crore to accelerate EV adoption and charging infrastructure development. EVs attract a reduced GST rate of 5%, compared to 28% on conventional vehicles, while buyers can claim income tax deductions of up to ₹1.5 lakh on EV loan interest under Section 80EEB.

Infrastructure expansion remains a key priority. Government guidelines target at least one public charging station every 25 km on major highways, supported by investments in thousands of fast-charging points and battery-swapping facilities. India’s public charging network has grown rapidly, crossing 25,000+ charging stations nationwide, with further expansion planned.

To strengthen domestic manufacturing, the government launched the PLI Scheme for Automobile and Auto Components, with an outlay of ₹25,938 crore, alongside the Advanced Chemistry Cell (ACC) Battery PLI Scheme worth ₹18,100 crore. These initiatives aim to reduce import dependence and establish large-scale local battery production.

State governments further enhance adoption through road tax and registration fee waivers, scrappage incentives, and fleet electrification mandates. For instance, Delhi EV Policy 2.0 offers scrappage-linked incentives of up to ₹1 lakh for electric cars, ₹25,000 for three-wheelers, and ₹10,000 for two-wheelers, while maintaining 100% road tax and registration fee exemptions for eligible EVs.

Driven by these policies, EV sales in India surpassed 1.9 million units in FY2025, with electric two-wheelers accounting for the majority of sales. The government aims to achieve 30% EV penetration in private cars, 70% in commercial vehicles, and 80% in two- and three-wheelers by 2030, highlighting the scale of India’s transition toward electric mobility.