The decision of Tesla, the world’s most valuable automobile manufacturer, to debut in India next year is the latest indication that 2021 could see electrical vehicles get a major push across India. Every global auto major is rolling out electric vehicles (EVs) and the Indian auto industry is following suit with many launches of EVs due. To its credit, the government has pushed EV adoption with tax breaks, stricter emission laws, and other policy support. But a lag in the creation of charging infrastructure could be a deterrent for prospective users, and policymakers need to examine this. There is preferential treatment for EVs in terms of tax rates under the FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) and FAME 2 policies. Goods and services tax for EVs is charged at 12 per cent, which is much lower than for internal combustion vehicles. Plus, public vehicle fleets are increasingly electrically powered under FAME 2.
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