Transport Ministry is aggressively trying to push the adoption of electric vehicles in India. The incentives introduced by the government include green number plates for electric vehicles, the proposal of scrapping permits to run commercial electric vehicles, allowing youth between the ages of 16-18 to ride electric scooters without a license and preferential parking for electric cars in certain areas. Now the government is planning to shift the electric vehicle batteries from 28 percent GST slab to 12 percent GST Slab.
The electric cars also fall in the same GST Slab. Tata Motors and Mahindra are the only manufacturers that are currently producing electric vehicles in India. Lower battery costs will, in turn, bring down the cost of electric vehicles and promote their adoption. The concept of swappable battery packs could also be boosted by lower battery costs. These batteries are currently imported from China and United States. The costs of the imported vehicle are not expected to change much.
The battery pack is the most expensive part of an electric vehicle. As per the cost calculated in 2018 the $ per kWh for a unit comes in a range of $225-$250. These figures are really impressive as the cost was about $1000 per kWh in the year 2010. The costs are further expected to decrease below $100 by 2026. The electric vehicles will witness mass adoption only when their price is same as that of an internal combustion engine.
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