Battery incentives and tech funding in Budget 2025 could lower EV prices, boost local production.
01 Feb 2025 | 2183 Views | By Sarthak Mahajan
Industry leaders across India's electric vehicle ecosystem have welcomed the Union Budget 2025's focus on clean technology and manufacturing, highlighting its potential to accelerate EV adoption and strengthen domestic production capabilities.
The budget's emphasis on domestic battery manufacturing has emerged as a key ...
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Industry leaders across India's electric vehicle ecosystem have welcomed the Union Budget 2025's focus on clean technology and manufacturing, highlighting its potential to accelerate EV adoption and strengthen domestic production capabilities.
The budget's emphasis on domestic battery manufacturing has emerged as a key highlight, with several measures aimed at reducing costs and enhancing supply chain efficiency. "The National Manufacturing Mission's coverage of MSME represents a step forward in bolstering domestic EV battery production," notes Pratik Kamdar, CEO & Co-Founder of Neuron Energy. The exemption of basic customs duty on lithium-ion batteries is expected to create more cost-effective and flexible supply chains.
Dinesh Arjun, CEO and Cofounder of Raptee.HV, emphasizes the significance of this move: "Given that batteries make up 30-40% of an EV's cost, this move will make EVs more affordable and accessible to consumers, driving mass adoption across two-wheelers, three-wheelers, and four-wheelers alike."
The budget's commitment to technological advancement has received particular praise from industry stakeholders. The allocation of a Deep Tech Fund is seen as a crucial step toward strengthening India's industrial ecosystem and fostering a globally competitive, tech-driven economy.
"The 2025 Union Budget lays a strong foundation for India's EV sector," says Akshit Bansal, Founder & CEO of Statiq. He particularly highlights how the National Manufacturing Mission's support for clean-tech industries, including EV batteries and high-voltage transmission equipment, will strengthen domestic manufacturing and reduce import dependence.
The budget's provisions for small businesses and manufacturing have been recognized as potentially transformative for the sector. Bhuvneshwar Pal Singh, Managing Director & CFO of Maxvolt Energy, describes the budget as "a game-changer for small businesses, exports, and manufacturing." He points to specific measures such as the introduction of customized credit cards for micro-enterprises with a ₹5 lakh limit as crucial steps in empowering grassroots entrepreneurs.
The focus on strengthening energy infrastructure, particularly for EV charging stations, has been noted as a critical component of the budget. Industry leaders believe the power sector reforms and state incentives will support greater EV adoption.
However, some stakeholders suggest there's room for further improvements. Bansal points out that "a revision in the GST structure for charging infrastructure is still needed. Bringing them in line with the 5% GST on EVs will further catalyze growth."
The budget's various initiatives, including the ₹10,000 crore infusion into the 'Fund of Funds for Startups', are expected to create an environment conducive to clean-tech innovation, job growth, and a more robust EV ecosystem. With these measures in place, industry leaders express confidence in India's path toward becoming a global leader in electric mobility.