India asks two-wheeler makers to draw up plan to switch to electric vehicles

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India’s Niti Aayog, a planning body of the government, has asked scooter and motorbike manufacturers to draw up a plan to switch to electric vehicles, Reuters reported.

Bajaj Auto, Hero MotoCorp and TVS, among others, received two weeks to come up with the plan.

The think-tank, which is chaired by Prime Minister Narendra Modi, recommended that only electric models of scooters and motorbikes with engine capacity of more than 150cc must be sold from 2025.

Automakers opposed the proposal and warned that a sudden transition, at a time when auto sales have slumped to a two-decade low, would cause market disruption and job loss.

India is one of the world’s largest two wheeler markets with sales of more than 20 million scooters and motorbikes last year. Government officials argued that switching to EVs is of national importance so India does not miss out on the global drive towards environmentally cleaner vehicles.

Industry executives responded that a premature switch with no established supply chain, charging infrastructure or skilled labour in India, could result in India losing its leadership position in scooters and motorbikes.

Niti Aayog is working with several other ministries on the recommendations, which are part of an electrification effort to help India reduce its fuel import bill and curb pollution.

The proposal also includes incentives for local production of batteries, an increase ownership cost of gasoline cars and forming a policy to scrap old vehicles.

The panel has also suggested measures such as directing taxi aggregators like Uber and Ola to convert 40 percent of their fleets to electric by April 2026.

Executives from EV start-up Ather Energy, ride-sharing firm Ola and officials from the Society of Indian Automobile Manufacturers (SIAM), an industry trade body, also attended the meeting.

The proposals are India’s second attempt for a switch to EVs. India in 2017 proposed an ambitious plan mainly for electric cars but rowed back after facing resistance from car makers.