{"id":49215,"date":"2025-06-03T15:48:02","date_gmt":"2025-06-03T10:18:02","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=49215"},"modified":"2025-06-03T18:07:14","modified_gmt":"2025-06-03T12:37:14","slug":"government-notifies-guidelines-to-promote-manufacturing-of-electric-passenger-cars-in-india","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/government-notifies-guidelines-to-promote-manufacturing-of-electric-passenger-cars-in-india\/","title":{"rendered":"Government Notifies Guidelines to Promote Manufacturing of Electric Passenger Cars in India"},"content":{"rendered":"<h2>India\u2019s Green Mobility Push Latest News<\/h2>\n<ul>\n<li>The Ministry of Heavy Industries issued detailed guidelines under the\u00a0<strong>Scheme to Promote Manufacturing of Electric Passenger Cars in India\u00a0<\/strong>(SPMEPCI), first notified on March 15, 2024.\u00a0<\/li>\n<li>The scheme offers\u00a0<strong>reduced import duties to global electric vehicle (EV) manufacturers<\/strong>\u00a0in return for significant investments in domestic manufacturing.<\/li>\n<li>The Union Heavy Industries Minister also noted that the global EV giant\u00a0<strong>Tesla\u00a0<\/strong>is not interested in manufacturing cars in India but keen on establishing showrooms in the country.<\/li>\n<li>Earlier, the\u00a0<strong>U.S. President Donald Trump<\/strong>\u00a0has said that if Tesla were to build a factory in India to circumvent that country&#8217;s tariffs, it would be &#8220;unfair&#8221; to the U.S.<\/li>\n<\/ul>\n<h2>Key Highlights of the Scheme<\/h2>\n<ul>\n<li><strong>Reduced import duties on electric vehicles:<\/strong>\n<ul>\n<li><strong>Companies can import\u00a0<\/strong>up to 8,000 electric four-wheeler (e-4W) units annually\u00a0<strong>at a reduced customs duty of 15%<\/strong>, compared to the existing 70\u2013100%.<\/li>\n<li>The benefit is\u00a0<strong>applicable for 5 years<\/strong>\u00a0from the date of application approval.<\/li>\n<li><strong>Applicable only on CBUs\u00a0<\/strong>(Completely Built Units) with a minimum CIF value of $35,000.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Investment mandate:<\/strong>\n<ul>\n<li>Approved applicants would be required to\u00a0<strong>make minimum investment of Rs. 4,150 crore<\/strong>\u00a0in line with the provisions of the scheme.<\/li>\n<li>Manufacturing operations\u00a0<strong>must commence within 3 years<\/strong>\u00a0of application approval.<\/li>\n<li><strong>Eligible investment includes:<\/strong>\n<ul>\n<li>New plant, machinery, equipment, and associated utilities<\/li>\n<li>Engineering Research and Development (ER&amp;D)<\/li>\n<li>New buildings (up to 10% of committed investment)<\/li>\n<li>Charging infrastructure (up to 5% of committed investment)<\/li>\n<\/ul>\n<\/li>\n<li><strong>Land costs are excluded<\/strong>\u00a0from eligible expenditure.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Domestic value addition (DVA) requirements:<\/strong>\n<ul>\n<li>Minimum 25% DVA within 3 years.<\/li>\n<li>Minimum 50% DVA within 5 years from the approval date.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2>Safeguard and Compliance Mechanisms<\/h2>\n<ul>\n<li>The Applicant\u2019s commitment to set up manufacturing facilities,\u00a0<strong>shall be backed by a Bank Guarantee<\/strong>\u00a0from a scheduled commercial bank in India equivalent to &#8211;\n<ul>\n<li>The total duty to be forgone (capped at \u20b96,484 crore per applicant) or\u00a0<\/li>\n<li>Rs 4,150 crore, whichever is higher.<\/li>\n<\/ul>\n<\/li>\n<li>The Bank Guarantee should be valid at all times during the tenure of the Scheme.<\/li>\n<\/ul>\n<h2>Eligibility Criteria for Applicants<\/h2>\n<ul>\n<li>To qualify and receive benefits under the scheme, an applicant is required to have a global group\u00a0<strong>revenue\u00a0<\/strong>from automotive manufacturing of\u00a0<strong>a minimum \u20b910,000 crore<\/strong>.\u00a0<\/li>\n<li>Moreover, the global\u00a0<strong>investment\u00a0<\/strong>of a company or its group companies in fixed assets must be at least\u00a0<strong>\u20b93,000 crore.<\/strong><\/li>\n<\/ul>\n<h2>Application Process<\/h2>\n<ul>\n<li><strong>Application window:<\/strong>\u00a0At least 120 days, starting soon (June 2025).<\/li>\n<li>The Ministry of Heavy Industries shall have the\u00a0<strong>right to open the application window<\/strong>, as and when required till March 15, 2026.<\/li>\n<li><strong>A non-refundable application fee<\/strong>\u00a0of \u20b95,00,000 will be payable by the applicant while filing the application form.<\/li>\n<\/ul>\n<h2>Schemes for Advancing India\u2019s EV Ecosystem<\/h2>\n<ul>\n<li><strong>PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme:<\/strong>\n<ul>\n<li>Notified on 29th September, 2024, to\u00a0<strong>incentivise\u00a0<\/strong>sale of e-2W, e-3W, e-Trucks, e-Ambulances, and e-buses.\u00a0<\/li>\n<li>The scheme also supports development of\u00a0<strong>charging\u00a0<\/strong>infrastructure and upgradation of vehicle\u00a0<strong>testing\u00a0<\/strong>agencies.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Production Linked Incentive Scheme for Automobile and Auto Component Industry (PLI-Auto):<\/strong>\u00a0Approved on 15th September, 2021, for enhancing India&#8217;s manufacturing capabilities for Advanced Automotive Technology (AAT) products.<\/li>\n<li><strong>PLI Scheme for Manufacturing Advanced Chemistry Cells (ACC):<\/strong>\u00a0Approved on 12th May, 2021, the scheme envisages to establish a cumulative ACC battery manufacturing capacity of 50 GWh.<\/li>\n<li><strong>FAME-II:<\/strong>\u00a0It was introduced with the\u00a0<strong>objective of domestic manufacturing of electric vehicles<\/strong>, its assemblies\/ sub-assemblies and parts\/sub-parts thereby increasing the domestic value addition.\u00a0<\/li>\n<li><strong>PM e-Bus Sewa-Payment Security Mechanism (PSM) Scheme:<\/strong>\u00a0The scheme aims to support deployment of more than 38,000 electric buses.<\/li>\n<li><strong>SPMEPCI:\u00a0<\/strong>This scheme promotes the manufacturing of electric cars in India.<\/li>\n<\/ul>\n<h2>Conclusion<\/h2>\n<ul>\n<li>This scheme is a significant policy step under\u00a0<strong>India\u2019s green mobility and manufacturing push<\/strong>, aligning with\u00a0<strong>net-zero emission goals, job creation, and boosting local value chains.<\/strong><\/li>\n<li>It seeks to make India<strong>\u00a0an attractive destination<\/strong>\u00a0for global EV manufacturers while\u00a0<strong>ensuring significant domestic economic benefits.<\/strong><\/li>\n<\/ul>\n<h2>India\u2019s Green Mobility Push FAQs<\/h2>\n<p><strong>Q1.\u00a0<\/strong>What are the key conditions for electric vehicle manufacturers to avail reduced import duties under the Government\u2019s new EV manufacturing scheme (SPMEPCI)?<\/p>\n<p><strong>Ans.<\/strong>\u00a0To avail the reduced 15% import duty on electric four-wheelers, manufacturers must invest a minimum of \u20b94,150 crore and set up local manufacturing within 3 years.<\/p>\n<p><strong>Q2.<\/strong>\u00a0What is the Domestic Value Addition (DVA) requirement under the electric passenger vehicle manufacturing scheme?<\/p>\n<p><strong>Ans.<\/strong>\u00a0Applicants must achieve at least 25% DVA within 3 years and 50% within 5 years from the date of approval.<\/p>\n<p><strong>Q3.<\/strong>\u00a0How has the scheme ensured accountability and compliance from the participating manufacturers?<\/p>\n<p><strong>Ans.\u00a0<\/strong>Compliance is ensured through a mandatory bank guarantee equal to the duty foregone or \u20b94,150 crore, whichever is higher.<\/p>\n<p><strong>Q4.<\/strong>\u00a0How does the scheme align with India\u2019s industrial and environmental policy goals?<\/p>\n<p><strong>Ans.\u00a0<\/strong>The scheme supports the Make in India initiative, promotes green mobility, and encourages foreign investment in clean technology manufacturing.<\/p>\n<p><strong>Q5.\u00a0<\/strong>What are the eligibility criteria for companies to apply under this scheme?<\/p>\n<p><strong>Ans.<\/strong>\u00a0Eligible companies must have a global automotive manufacturing revenue of \u20b910,000 crore and a minimum global fixed asset investment of \u20b93,000 crore.<\/p>\n<p><strong>Source:<\/strong>\u00a0<a href=\"https:\/\/www.thehindu.com\/business\/Industry\/centre-cuts-import-duty-on-electric-cars-in-lieu-of-local-manufacturing\/article69649426.ece\" target=\"_blank\" rel=\"nofollow noopener\">TH<\/a>\u00a0|\u00a0<a href=\"https:\/\/www.thehindu.com\/business\/Industry\/tesla-not-interested-in-manufacturing-electric-cars-in-india-kumaraswamy\/article69648257.ece\" target=\"_blank\" rel=\"nofollow noopener\">TH<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Ministry of Heavy Industries issued detailed guidelines under the Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI).<\/p>\n","protected":false},"author":8,"featured_media":49218,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[675,60,22,668],"class_list":{"0":"post-49215","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"tag-indias-green-mobility-push","9":"tag-mains-articles","10":"tag-upsc-current-affairs","11":"tag-upsc-mains-current-afffairs","12":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/49215","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=49215"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/49215\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/49218"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=49215"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=49215"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=49215"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}