The Society of Indian Automobile Manufacturers (SIAM) has cautioned the government over the draft electric vehicle policy which proposes banning of all internal combustion three-wheelers by 2023, and two-wheelers below 150 cc with internal combustion engines by 2025. The automobile industry body said that while the industry supports the ambitious aspiration set by the government's think-tank Niti Aayog in bringing in electric mobility, it needs to be practical in approach, without needlessly disrupting the automotive industry. In a statement, SIAM has said that the industry is already facing multiple challenges of leapfrogging to the Bharat Stage VI emission norms, as well as new safety regulations.
"The automotive industry, today, is facing multiple challenges of leapfrogging to BS VI emission norms, complying with many new safety norms etc., in the shortest time-frame ever attempted in the world. This is engaging the focused attention of the industry and involving huge investments of the order of ₹ 70,000-80,000 crores. Even before this investment is recovered, as per media reports, Government is proposing to ban sales of ICE based three wheelers within a short time frame of 2023 and to ban sales of less than 150 cc 2 wheelers by 2025. This seems to be impractical as well as untimely," Rajan Wadhera, President, SIAM, said in a statement.
According to SIAM, the Indian automotive industry has been highly proactive when it comes to fulfilling national interest, and has been a staunch supporter of 'Make in India' even before the term was coined. SIAM maintains the automotive industry's turnover is close to half of the manufacturing GDP, supports 37 million jobs and contributes 11 per cent of GST revenues of the country. It also supports a host of manufacturing and services industries, SIAM said.
"Overall the auto industry is perhaps the only real success story of India's manufacturing. It is imperative that this success story is not affected by undue haste in banning mature automotive technologies within the next 5-6 years in the hope that evolving EV technologies will fully replace the demand within that such a short period. Such unrealistic expectations and policies would only adversely affect the world's No. 1 two/three-wheeler industry but may not help in making EVs acceptable to the customer and the market," added Wadhera.
"The automotive industry, especially the two/three-wheeler segment supports a large number of component suppliers in the small and medium sector, who are the real backbone of the auto industry. None of the stakeholders in the country - industry, Government nor the suppliers have any meaningful experience of EVs to even contemplate a complete 100 per cent shift to 2/3 wheeled EVs by 2023/2025," said. Wadhera. "In the current scenario, any policy to accelerate the transition to EVS would lead to a policy induced disruption which could result in significant damage to the auto industry and spell a big blow to the overall ecosystem of these MSMEs, with its related impact on employment," added Wadhera.
According to SIAM, what is required is a well laid out roadmap for an ambitious electric vehicle rollout over a practical timeframe along with an integrated plan for setting up the necessary infrastructure across the length and breadth of the country, in consultation with all stakeholders. The Niti Aayog has proposed electrifying most motorcycles and scooters within the next six years, to curb pollution and reduce dependency on fossil fuels. The Niti Aayog has also proposed a ban on three-wheelers with internal combustion engines by 2023. While the government proposal may be noble, to clean up the environment, and rid India's cities of pollution, there's no denying the fact that there is limited infrastructure - both in terms of charging, as well as gaps in the supply chain for electric vehicle components. There's also the cost factor - with most EV products available now coming with added cost, from a consumer point of view.