India to be world’s 4th largest electric car maker by 2030

Context: India’s planned electric four-wheeler manufacturing capacity is projected to rise over tenfold to 2.5 million units by 2030, up from just 0.2 million at present, making it the fourth-largest electric car producer globally after China, Europe, and the US. 

Electric Vehicle Manufacturing in India

Rapid Expansion

• By 2030, India’s electric car demand is estimated to reach between 0.4-1.4 million units, up from 0.1 million in 2024. The electric vehicle (EV) penetration rate would be around 7-23% in four-wheelers from 2% in 2024. 
• India’s electric car production capacity is expected to reach 2.5 million units, and the manufacturing capacity would outstrip domestic demand. India’s anticipated production capacity will be far behind China’s 29 million, EU’s 9 million, and 6 million in the US.

Need to catch up Pace:  

• To protect local manufacturers, India has maintained import tariffs of up to 70-100% on fully built EVs. However, this protective stance also limits consumer choice and raises costs. Presently, almost 100% of India’s EV manufacturing is only for its domestic market. 
• By 2030, India’s cell production capacity will lag behind China, Europe, the US, and Canada. China is expected to lead with a cell manufacturing capacity of 4,818 gigawatt hours (GWh), in contrast to India at 567 GWh. 

Govt. Initiatives to drive India's EV Sector: 

• FAME Scheme (Phase I & II)
• PLI Scheme for Automobile and Auto Components (PLI-Auto)
• PLI Scheme for Advanced Chemistry Cells (PLI-ACC)
• PM E-DRIVE Scheme (Electric Drive Revolution in Innovative Vehicle Enhancement)
• SPMEPCI Scheme (Scheme to Promote Manufacturing of Electric Passenger Cars in India)

The increase in domestic EV manufacturing aligns with the government’s strategy to ‘Make in India for the world’. However, Indian companies will need to lower the cost of manufacturing to compete with exports from China.

Also Read: Addressing Policy Gaps in India’s EV Journey