(MENAFN- KNN India) New Delhi, Apr 30 (KNN) The Indian government is set to release guidelines for its new electric vehicle (EV) policy in the coming weeks, paving the way for the policy to become fully operational in the next few months.
Highly-placed sources indicate that some EV manufacturers have urged the government to include investments in existing facilities or "brownfield" projects under the policy's definition of eligible investments. Currently, the policy only considers new "greenfield" plants, reported businessline.
The EV policy, approved on March 15th, aims to establish India as a global manufacturing hub for electric vehicles. It incentivises companies to set up local production by allowing limited duty-free imports initially.
However, they must establish manufacturing facilities within three years and achieve 50 per cent localisation of components by the fifth year.
An official privy to the discussions stated, "The guidelines are expected in the next three-four weeks. Some OEMs were asking if brownfield investments could be counted under the policy to avail benefits. This will be discussed further while finalising the guidelines."
However, the same official mentioned that theoretically, benefits may only be applicable for dedicated new EV factories to meet the domestic value-addition targets of 25 per cent in three years and 50 per cent in five years. Existing facilities may not qualify.
As per the policy notification, companies must invest a minimum of USD 500 million to set up EV manufacturing in India.
There is no cap on maximum permissible investment. The policy also provides a 15 per cent concessional customs duty rate on imported knocked-down units for 5 years to support localisation.
(KNN Bureau)
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