Fri. Mar 29th, 2024
picture credits- esi-africa.com

Electronic vehicle market presents itself as an unadorned opportunity for India. A visionary idea for an ‘Atmanirbhar bharat’ can be realized with the opportunities presented by this particular market. India’s electronic market is set to grow nearly $206 billion in the coming decade, which will have its benefits to offer.

India’s 2030 visionary EV ambition signals towards electrification of 70% of all commercial cars, 30% of private cars, 40% of buses and 80% of two and three wheelers sale in 2030. India should be applauded for its visionary approach towards a greener future that gained momentum after the implementation of the FAME India scheme. India unveiled ‘National Electric Mobility Mission Plan 2020’ in 2013 to grow manufacturing capacity and adhere to its commitment to the Paris Agreement for a strategic shift to electric vehicles by 2030.

What problems face India in its EV market strategy? Challenges like lack of charging infrastructure, lack of high initial cost and lack of electricity from renewable resources daunt India’s progression in the EV market. Currently, china has an unrestricted monopoly in the market, producing 80% of the electronic vehicles due its rich lithium reserves. India’s entry into this lucrative venture would mean a stiff competition to china to rectify the India- china border standoffs and chastise or redress China for its territorial ambitions.

India is required to invest $180 billion for power, charge point operators and Battery manufacturing infrastructure. The CEEW-CEF study states that to realize India’s EV ambition would require annual battery capacity of 158 GWh by FY30. This battery capacity requires $6.1 billion investment if 50% of the investment was to be undertaken indigenously and will further extent to approximately $12 billion, if the whole battery capacity investment was to be undertaken by India.

This is a massive manufacturing opportunity presented to India giving it a viable, long term job market. Furthermore, according to the recent study, India would require 2.9 million charging point, another infrastructure investment of $2.9 billion. At the current pace, India has just 1800 charging points. Thus, a massive investment and organizational difficulties await India in its vision of 2030 electric vehicle market.

EV market opportunities do not end right there, it also provides a massive opportunity for the automobile loan markets. If the total of the financing of $108 dollars were to be undertaken by the banking system, it would have more than triple its current advances in future. Auto Industry contributes a hefty 22% to the manufacturing GDP. The ‘national Electronic Mobility Plan’ will contribute to 25% by the year 2022.

But it is not all rosy when it comes to India’s lithium story. India currently imports all its lithium batteries which amounted to $1.2 billion in fiscal year 2019. Its various reasons include absence of local mines for lithium in India and conscious mining. Though there has been a discovery of lithium reserves of 14,100 tons in a small patch of land in Southern Karnataka district, a golden opportunity for India, but how India takes advantage requires diligent analysis.

Now, how India’s ambitious goal of EV market goes about in future is an area of deliberation. India’s investment in conscious mining, investment in research for efficient ways of mining and foreign joint investment (due to credit crunch) will pave the way, but when will this lucrative plan fructify, is still a mystery.

By Shivani Khanna

A woman who believes in equal rights and aspires to inspire people through her writings. I aspire to contribute to the economic world and society with diligence and thus being an economic advisor tops my career ambitions . I currently am pursuing Economic honours ( at undergrad level) from delhi university.