Electric vehicles (EVs), roughly 1 per cent of the overall automotive industry in India has been doubling year-on-year. In her 90-minute Union Budget 2022, Finance Minister Nirmala Sitharaman announced new initiatives to further accelerate the adoption of EVs in India. “To promote a shift to the use of public transport in urban areas. Special mobility zones with zero fossil fuel policy to be introduced. Considering space constraints in urban areas, a 'Battery Swapping Policy' will be brought in," she said.
She added that the government will introduce the new policy for battery swapping to encourage the use of electric vehicles and achieve its broader decarbonisation goals. The government will also develop special mobility zones for electric vehicles. “In the coming fiscal, the government will also formulate a new battery swapping technology in India,” she said.
This, the industry feels, is a big boost for EV adoption and in tune with India’s aspiration of net zero emissions by 2070 in the COP26 climate summit held at Geneva. “Battery swapping policy including interoperability could be a big booster for all the start-ups already working in this space. It could also help drive movement to electrification of fleets especially for last mile connectivity for both people & goods,” Rajeev Singh, Partner and Automotive leader, Deloitte India, said.
EV financing companies see this as an opportunity to promote large-scale adoption of EVs.
"A policy on battery swapping will help in wide scale adoption of batteries as a service. This will reduce upfront ownership costs of electric vehicles and link that cost to vehicle running. Since the cost of running electric vehicles is cheaper, the overall running cost with battery service will work out to be more economical than usage of ICE based vehicles. This is a very welcome announcement in the union budget. This will also create opportunities for several new startups", said Sameer Aggarwal, CEO and Founder, RevFin, an EV financing platform.
"Zero emission zones in cities will help bring prominence to electric vehicles as well as provide incentive to purchase electric vehicles to be able to use those zones,” he added.