A new research by the New York-based Rhodium group stated that India will become the fourth largest electric car manufacturer by 2030 by increasing its production from the current 0.2 million to 2.5 million units, making it the fourth largest in the world after China, Europe, and the US. The report highlighted another interesting fact that in the next five years, India’s electric cars will outnumber the domestic demand by over 1.1 to 2.1 million units.
This is a great opportunity to increase exports, but the report points out that the export benefits can only be reaped if costs are “driven down”. It says that only if the costs are reduced can the manufacturing boom compete with China. It says that from the current 0.1 million, the domestic demand will also shoot up to 0.4 to 1.4 million units in 2030. As per the report, the total car sales are projected to rise to 6 million, which suggests that electric vehicles will comprise 7 to 23 per cent of the total cars made in India.
The production capacity is also expected to increase to about 2.5 million units. In its Global Clean Investment Monitor report, Rhodium said that “This far exceeds India’s projected 2030 EV demand,” which is somewhere between 0.4 to 1.4 million vehicles, depending upon other factors like investment and policy measures.
This is in conformity with the “Make in India for the World” push by the government of India. But the report emphasised that this export boom will only become a reality if the private companies and manufacturers cut the cost of manufacturing to compete with Chinese exports. Though India’s projected output will be far less compared to China’s 29 million, Europe’s 9 million, and the USA’s 6 million, it will become a major centre outside these countries and even surpass the other Asian countries, including South Korea and Japan.
It must be noted that currently, the manufacturing capacities in Korea and Japan are more than India, the ones in construction capacities for the future are less than India. In numbers, it is 1.4 million units for Japan and 1.9 million units for South Korea by 2030. The report also lauded India’s path to EV manufacturing, saying that its policy of combining market incentives, investment subsidies, and consumer benefits, along with increasing charging stations, has benefited the country in the race.
India has taken a protectionist stand in the EV sector, charging a high tariff of 70 to 100 per cent on fully built EVs, benefiting the local manufacturers.
