Context:

The Ministry of Heavy Industries (MHI) has released detailed guidelines for the Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI). This initiative aims to make India a global hub for electric vehicle (EV) production, while supporting the country’s net-zero emissions target by 2070.

About the SPMEPCI Scheme:

• Nodal Ministry: Ministry of Heavy Industries (MHI)
• Launch Year: 2024
• Key Objectives:
  • Attract foreign investment in India’s electric vehicle sector
  • Promote domestic EV manufacturing
  • Support industrial growth and job creation
  • Contribute to India’s climate goals (Net-zero by 2070)

Scheme Guidelines

• Approved companies can import a limited number of fully built electric four-wheelers (e-4Ws) at a reduced customs duty rate of 15%, valid for five years.
• Each imported vehicle must have a minimum CIF (Cost, Insurance, and Freight) value of USD 35,000.
• A maximum of 8,000 units per year may be imported under this concession. Unused quotas can be carried forward to subsequent years.
• The total duty forgone under the scheme will be capped at the lower of ?6,484 crore or the actual investment made by the company.

Significance of the Scheme

• Promotes transfer of advanced EV technologies to India
• Reinforces Make in India and Aatmanirbhar Bharat initiatives
• Drives adoption of clean mobility solutions
• Aims to generate high-skilled employment in manufacturing and R&D
• Positions India as a preferred destination for global EV investment

Complementary EV Mobility Initiatives in India

• Electric Mobility Promotion Scheme (EMPS) 2024
  • Budget: ?778 crore for six months (April–September 2024)
  • Incentives for buyers of electric 2-wheelers (e-2Ws) and electric 3-wheelers (e-3Ws)
• Production Linked Incentive (PLI) Scheme for Auto & Auto Components (PLI-AAT)
  • Budget: ?25,938 crore
  • Covers a wide range of EVs: e-2Ws, e-3Ws, e-4Ws, e-buses, and e-trucks
• PLI Scheme for Advanced Chemistry Cell (PLI-ACC)
  • Budget: ?18,100 crore
  • Supports domestic manufacturing of advanced battery technologies
• PM E-DRIVE Scheme (Prime Minister’s Electric Drive Revolution in Innovative Vehicle Enhancement)
  • Replaces FAME India Phase II
  • Focus: Promotion of electric buses, trucks, and ambulances
  • Excludes private or shared-use electric cars