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Union Budget 2019: Good News For Electric Two-wheelers

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  • Jul 5, 2019
  • Views : 1733

With this new budget, the government has made sure that electric two-wheelers don’t burn a hole in your pocket

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  • Government proposes to reduce the GST rates on EVs.
  • Custom duties on some components been reduced as well. 
  • With the new budget in place, prices of electric vehicles should witness a drop.

Electric mobility in India got a major boost today as the Government has announced that it has asked the GST council to lower the GST rate on electric vehicles from 12 per cent to 5 per cent. To further boost electric mobility, the government has also announced that custom duties on certain parts used in EVs have been exempted, which should help reduce the cost. The government has not divulged details on which parts will be exempted.

All these factors should bring down the cost of electric vehicles, especially electric two-wheelers, by a considerable margin. Given that the cost of electric two-wheelers is considerably higher than their petrol-powered counterparts, the 2019 budget has made sure that this segment will seek benefit from the new initiatives.

Also read: Union Budget 2019: Government To Slash GST On EVs To 5 Percent

The industry is already praising the government’s agenda to start a green revolution. In a statement, Jeetender Sharma, founder & MD, Okinawa, said, “The Union Budget 2019-20 is very progressive and growth-oriented. Hon'ble Finance Minister’s emphasis on FAME II initiative and pushing EV infrastructure will help in attracting investment for local manufacture of components which will further strengthen Make In India initiative and ensure clean and green energy over time.”

A few months back, phase two of the FAME scheme, for which the Government has already set aside Rs 10,000 crore, came into effect. According to this scheme, the Government is planning to install 2,700 charging stations in metros. Additionally, charging stations are also proposed to be set up at every 25km on both sides of highways connecting major cities.

The reduction in taxes and increased focus on improving the charging infrastructure, in our opinion, should boost the rate of EV adoption in the country.

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