An EV friendly Budget 2019!

Ola Mobility Institute (OMI) welcomes the Government’s intent and focus towards vehicle electrification. India has a unique opportunity to secure its economy by reducing dependency on fossil fuels, curb air pollution, and lead the EV race globally. We hope the government takes cognizance of the investments required to create an enabling environment for putting EV wheels on the road and balances it alongside battery charging requirements. Viability gap funding is required for the one cost that makes EVs expensive — batteries. Herein lies the chance for India to enable local manufacturing and innovation in battery technologies and management systems, retain our export strength in the automotive industry, and thereby become a global power to reckon with.

Battery Swapping, especially for small format vehicles, holds the promise to enable early scale in India’s EV ambitions. We hope the budget also sees value in this proposition and provides adequate fiscal signals to boost this industry . It is imperative that the EV scaling ambitions be weighed against placing undue commercial burden on any one particular market actor given that electrification can only be achieved by Government and Industry working in collaboration. In this vein, OMI recommends:

1. Extending demand incentives to batteries and treating vehicles without pre-fitted batteries as Electric Vehicles too

2. Offering incentives to Battery Swapping models by extending small incentives (like income tax benefits, waiver of GST, green credits, etc.) to shop owners to set up charging/swapping stations and giving a boost to India’s micro-entrepreneurship ecosystem

3. Offering GST subvention on swapping services and creating a revenue-neutral mechanism to incentivize outcomes

4. Identifying Battery-as-a-service providers as eligible for priority sector lending by financial institutions