India plans levy on petrol, diesel cars to boost EV demand: report

(Reuters) - The government has drafted a plan to levy a fee of 12,000 rupees ($171.09) on new petrol and diesel cars in an attempt to boost the manufacturing of electric vehicles (EV) and battery-driven automobiles, the Times of India reported https://bit.ly/2BumL88 on Wednesday.

Under a new policy that is nearing finalisation, National Institution for Transforming India (NITI), a government policy think-tank, has proposed incentives of up to 25,000 rupees-50,000 rupees be directly transferred to EV buyers, ensuring that gains are not pocketed by auto manufacturers, government officials told TOI.

New incentives will be proposed along with other benefits such as lower customs duty, goods and services tax on raw material, components and battery packs, waiver of registration fee and road tax for all EVs, according to the report.

The proposed incentives for EV owners will be trimmed to 15,000 rupees from 50,000 rupees by the fourth year of the policy implementation, the daily reported.

Citing a source, the Times of India stated that part of the surcharge will be used to encourage domestic battery production and that the government plans to spend about two billion rupees for developing indigenous technology in power electronics and battery development.

NITI Aayog did not immediately respond to Reuters' request for comment.

($1 = 70.1400 Indian rupees)

(Reporting by Chandini Monnappa in Bengaluru, Editing by Sherry Jacob-Phillips)