Team-innovateEngineers
The new EV policy, announced in March 2024, introduces incentives to encourage investments in electric vehicle (EV) manufacturing. Under the Scheme for Manufacturing of Electric Cars (SMEC), companies investing in physical infrastructure like plants, machinery, and charging stations can qualify for benefits. To be eligible, companies must invest a minimum of USD 500 million, with at least 50% of the value addition being domestic.
Qualifying investments will receive concessional import duties on select vehicles. However, royalty payments to overseas parent companies won’t be counted as eligible investments. Discussions are ongoing to specify qualifying investments, with key stakeholders such as Tesla, VinFAST, Tata Motors, and Hyundai actively participating.
The consultations aim to clarify investment criteria and refine policy details. Qualifying investments cover expenses on plant and machinery, charging infrastructure, and company-owned assets, excluding company premises. Additionally, up to 10% of building costs can be considered as an investment towards EV manufacturing capacity.
These discussions, involving global and local companies like Tesla, VinFAST, Tata Motors, Maruti Suzuki, Hyundai, and BMW, seek to finalize guidelines with the Ministry of Heavy Industries.
