Application portal open for electric car makers, many benefits will be available with low import duty
EV Portal, Portal for Electric Car Makers: The government has launched a new portal to promote electric passenger car manufacturing, where automobile companies can apply. Under the scheme, special concessions will be given to companies investing with low import duty.
The government of India announced a new initiative to boost domestic electric passenger vehicle production. Heavy Industries Minister HD Kumaraswamy on Monday launched a portal where car manufacturers could submit their applications under the Electric Car Scheme. This portal will remain until 21 October 2025.
Under the scheme, if auto companies undertake to enter electric car production in India, they would be granted tremendous discounts on import duty. Import of up to 8,000 EVs would be allowed with only 15 percent duty as against the current import duty of 70-100 percent, if the company invests an amount of Rs 4,150 crore.
Kumaraswamy informed that the American company Tesla is currently only showing interest in opening showrooms in India, not in setting up a manufacturing unit. At the same time, Mercedes-Benz has already invested heavily in India before applying.
According to the scheme, the companies applying will have to start production within three years, and it will be mandatory to increase at least 25 percent domestic value addition (DVA) in the first three years and to 50 percent in five years.
Heavy Industries Ministry Secretary Kamran Rizvi said that letters are being sent to the embassies of automobile majors of Germany, America, Britain, and other countries to connect them with the scheme. However, investment restrictions will remain in place for bordering countries like China and Pakistan.
A maximum duty exemption of Rs 6,484 crore can be given under this scheme. Companies will have to provide a bank guarantee from a scheduled commercial bank, which should be equal to the duty exemption or Rs 4,150 crore (whichever is higher).
The application fee has been capped at Rs 5 lakh, and only companies with global automotive revenue of at least Rs 10,000 crore and investments in global fixed assets of at least Rs 3,000 crore will be eligible.
The scheme was first notified on March 15, 2024, and under this, expenditure made on plant, machinery, R&,D and charging infrastructure will be included in the investment profit.
