Taxing cars to promote EVs will only benefit rich: Maruti Suzuki chairman

Tax 2-wheelers also to promote e-mobility: Maruti Suzuki Chairman Bhargava

The imposition of a cess on conventional vehicles to encourage electric mobility may not serve the purpose, as subsidies will end up going only to the rich. Any subsidy will not make small cars affordable, Maruti Suzuki Chairman R C Bhargava said on Wednesday.

Arguing that only cars should not be subjected to a cess to promote electric vehicles (EVs), he said two-wheelers, which consume two-thirds of petrol in the country, must not be left out in the electrification drive, as these are much easier to be charged at homes.

“The biggest problem in India is the large number of small cars. Around 70 per cent of these cars could not be parked at homes and thus cannot be charged. I don’t think that small car electrification can happen on the basis of subsidies. We need technology for that,” Bhargava said.

He was responding to report of a proposal to impose cess of Rs 500-25,000 on conventional vehicles to promote clean energy vehicles. “If the principle is that a polluter pays then two-wheelers are also polluters. Why not a cess on two-wheelers also, so that the cess of petrol two-wheelers is utilised to subsidise electric two-wheelers,” Bhargava said.

While Maruti Suzuki has announced plan to launch its first electric car in 2020, Bhargava said policy makers should find intermediate solutions to the problem of vehicular emission. Besides electric vehicles, promotion of CNG and hybrid cars will also help, he said. 

“If at all there is a cess on internal combustion vehicles, why not use this fund to build CNG infrastructure? It will happen quickly and give results quickly as well... even with infrastructure shortage, sales of CNG cars have been going up,” Bhargava noted. “EV is not the only technology. It is a means to an end and not an end in itself,” he said, urging policy makers to consider other technologies as well.