Many paths to zero

Policy should focus on emission reduction, not just EVs

Union Transport Minister Nitin Gadkari has said that, in the first half of 2021, the American-designed Tesla electric car will begin to be available in India. Completely assembled units of the car will first be imported and sold here and then, according to Mr Gadkari, it might be partially and wholly manufactured in India. Those later steps are some distance in the future, however. They will depend not just on what the uptake is for Teslas in urban India, but also on the broader regulatory environment for electric vehicles (EVs) in general. It is worth noting that EVs are a major focus sector for the government as part of its new industrial policy.

Yet a supportive environment for the transition to a low-emission transport sector in India requires a great deal more than is currently being envisaged. Current plans are little more than applications of crude incentive schemes to this sunrise sector. Differential tax or subsidy regimes have already received attention from the government. But EVs, for example, will require wide and sustained investment in supportive infrastructure in urban areas, from charging stations to specialised parking. The government has announced plans for almost 70,000 charging stations across India, and there has been some corporate interest as well. It is worth noting, however, how vexed investment in urban infrastructure can be. Some blue-sky thinking will be needed here: Perhaps a specialised vehicle, half owned by the Union government and half with the private sector, can partner state governments in creating land banks for EV charging, and then licensing or auctioning them out. Designing the mechanics of this massive infrastructure rollout in advance to take into account efficiency, transparency, and equity will be of paramount importance.

India in any case has some very specific problems when it comes to EVs. For one, the electricity supply is not reliable in terms of quality, pricing, or even availability. Consumers will balk if they are concerned that their expensive hardware is exposed to voltage fluctuations at public charging stations, or if the pricing of a full battery is variable across different parts of a city. And, of course, in many parts of the country 24x7 grid power is not yet a reality. Such concerns have not prevented the rise of electrified three-wheelers, however — yet those are at a very different price point from most electric vehicles and have different ownership compulsions and behaviours attached. Importantly, many legacy carmakers in India have noted that an all-electric strategy does not necessarily play to India’s strengths or requirements. The government must keep in mind the real goal is to reduce carbon emission from the transport sector significantly while improving air quality and promoting energy independence. Full electrification of the private four-wheeler fleet is only one pathway to achieve this goal, and not necessarily the best one. Policy must be agnostic to methodology — it does not matter what colour the cat is as long as it catches mice, to quote Deng Xiaoping. Some carmakers want incentives for hybrids; a sliding scale of incentives that matches the emission impact of each type of car should be considered.