Time To Electrify India’s Transport is Right Now

India, with its ambition to become a developed nation by 2047, should expedite the adoption of electric vehicles and commit to emissions reduction sooner than later. I don’t think we should hide behind the fact that our per capita emissions are still much below average globally. The argument rather should be that we can jump ahead of the development curve if we adopt the emerging technologies faster than others. In that sense, right now is the time to electrify our transport infrastructure and mobility solutions.

Electric vehicles (EVs) constitute more than 50% of vehicles in China, more than 20% in Europe and about 10% in the US. In India, it is about 2% right now. The contrasting fact is that China is facing increasing alienation and tariffs and the world is turning towards India as a manufacturing hub.

Former G20 Sherpa Amitabh Kant has argued that India needs to be at least 60% electric by 2030, which is only five years from now, and 100% by 2035, that is the next decade. The governance push should happen now.

No Ideological Issue

Mark Moore, a noted public management scholar, explained how certain ideas get pushed more than others—it’s a matter of legitimacy (by stakeholders) and operational capacity (by government and businesses). Having both is a tricky thing most of the time barring perhaps fighting a war or overpowering a pandemic.

If we want to have the Olympics in India, people will support it. But creating operational capacity may prove to be a bottleneck, and the same is the case with most welfare schemes. On the other hand, creating legitimacy around issues such as genetically-modified crops may prove difficult despite possessing research centres, scientists and the money. Or even the well-intentioned odd-even policy in the National Capital Region (NCR).

However, adopting EVs does not pose any such ideological issue. A survey by Urban Science and The Harris Poll found 83% of respondents were willing to buy an EV as their only option by the end of the decade and about 49% are also willing to pay for the transition. If the legitimacy already exists, let’s make the transition operationally possible. India needs to push the manufacturing and incentivise businesses.

Get the Big Hammer Out

The FAME (Faster Adoption and Manufacturing of EVs) I and II did precisely that and have proved the concept for the government. The first two schemes provided subsidies for vehicles with advanced batteries, such as lithium-ion batteries and promoted the localisation of EV manufacturing and the development of advanced charging technologies.

Unfortunately, 42 out of the world’s 50 most polluted cities are in India. Whatever may be the contribution of vehicular pollution to the overall scenario, it is going to go up, due to increased mobility and rising population.    

We can adopt supply-side interventions by electrifying public transport, but we also need to factor in the demand-side. Thus, we need investments and incentives for fast chargers, batteries and manufacturing of two and three-wheelers specifically.

Another FAME

I, therefore, expect the government to announce FAME-III. As per the government figures, there is 31% of the budget of Rs 11,500 crore unutilised. The scheme achieved 55% of its target for passenger cars; however, it was able to achieve 66% in EV buses, 75% in two-wheelers and a commendable 84% in three-wheelers.

This shows the uptake and demand for public transportation. FAME II primarily focused on two- and three-wheelers and rightly so. As these two segments satisfy most on-road commuting needs. FAME III, however, can expand the focus to passenger vehicles, buses and trucks. In doing so, a faster adoption can help reduce the price point of batteries, which creates the biggest cost barrier for mass adoption.

India is up and running and mobile like never before. Let’s decarbonise transportation. It’s time we fuelled our aspirations for growth without adding to our emissions burden.

The writer is assistant professor, strategy at International Management Institute, Delhi