See acceleration of EV penetration in India in 2025-26: HMIL COO Tarun Garg
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September 30, 2024
New localization guidelines for electric vehicle (EV) subsidies will take effect in April 2025. Due to these requirements, a sizable percentage of the parts and materials used in the production of electric vehicles must come from regional vendors.
1. Minimum Localization Requirements: A set percentage of the vehicle’s value must be obtained from locally sourced parts and materials. This figure is likely to rise annually.
2. Supplier Chain Transparency: Manufacturers must offer extensive documentation demonstrating compliance with localization criteria, including supply chain audits.
3.Local Production Incentives: Manufacturers who exceed the localization thresholds may be eligible for additional subsidies or tax incentives.
4. Noncompliance Penalties: Companies that fail to achieve localization standards may risk reduced subsidies or other financial penalties.
5. Support for Local Suppliers: Programs will be created to assist local suppliers, including training and money to help them fulfill the necessary standards.
6. Monitoring and reporting: systems will be put in place on a regular basis to guarantee that localization rules are followed.
7. Impact Assessment: Periodic assessments will be done to assess the success of these laws in stimulating local economies and reducing reliance on foreign imports.
This program seeks to balance the growth of the EV market with economic benefits for local communities, resulting in a more sustainable and self-sufficient automotive sector.
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