EV subsidies not justified any more: Nitin Gadkari

Union Road Transport and Highways Minister Nitin Gadkari stated on Thursday that India's electric vehicle (EV) industry no longer required government subsidies, citing increased demand and lower prices in the sector. 

"In my opinion, the manufacturing of electric vehicles no longer needs to be subsidised by the government," he stated at the Bloomberg NEF summit in New Delhi. 

Gadkari said that while initial expenses were high, as demand rose, production costs decreased, making more subsidies unnecessary.

He further underlined that electric automobiles currently enjoy benefits from favourable taxation policies like low GST on EVs set at only 5%. According to Gadkari, these benefits give EVs a major edge over petrol and diesel vehicles. 

Gadkari said that the demand for subsidies is no longer justified and highlighted the concern about India’s dependence on fossil fuel imports. 

It is to be noted that Gadkari has denied any possibility of imposing extra taxes on petrol and diesel vehicles. Instead, according to him, the government of India is trying to focus on bolstering EV use, especially in the public transport domain.

"Electric buses can play a major role in reducing fossil fuel dependence and pollution levels," Gadkari stated.

Gadkari also announced the government's plans to introduce intercity electric buses shortly, which will help reduce fossil fuel imports. He admitted that, while India's fossil fuel economy is massive, the transition to electric cars will help to reduce its size over time.

The minister also emphasised India's promotion to the world's third-biggest vehicle manufacturer, predicting that with expanded EV manufacturing and domestic demand, the nation may become the largest exporter of lithium-ion batteries over the next five years.