Decarbonising road transport in India: A critique of the electric vehicle policy

The paper “Decarbonising road transport in India: A critique of the electric vehicle policy” will be presented at the FSR Sustainability Conference on “Greening Infrastructures” (22 June 2022).

Abstract

According to the International Energy Agency 2020, transport emissions account for 13.5% of the total energy-related carbon emissions in India. Road accounts for 90% of the sector’s final energy consumption, followed by rail and domestic aviation (both at 4%). Henceforth, decarbonisation has become an important agenda of all Indian government policies.

The government of India’s response to address road transport emissions included policy thrust on increasing the share of: (i) electric vehicles (ii) cleaner fuels, and  (iii) non-motorized and rail-based transport. Given the dominance of road transport in freight and passenger, the electric vehicle industry is given significant policy attention since 2011. India has set a target of a 30% penetration of electric vehicles by 2030, which currently is less than 1%. The achievement of this target requires coordinated efforts from all stakeholders. Given the current institutional structure of the transport sector and other important ministries, the goals of individual ministries do not always align with the larger policy objectives. There is a minimum of eight federal ministries that must coordinate to achieve the policy targets of transport emissions. The absence of an integrated transport ministry makes it difficult to address problems that cut across various modes of transport at a macro level.

The purpose of the paper is to analyze the government EV schemes, conduciveness of the existing institutional structures and implementation mechanisms for achieving the targets set for the growth of the electric vehicle industry. The paper will also study the EU’s ‘Fit for 55’ package and the ‘Green Deal’ in the context of electric vehicles for referencing and cross-learning.

The paper analyses the current electric vehicle policy on four parameters- vehicles attributes (cost, battery, variety), support infrastructure (charging stations), government schemes/policies (incentives to stakeholders such as vehicle manufacturers and buyers, the share of renewable electric supply, institutional mechanism), and exogenous factors (fuel prices, availability of electric supply). The paper examines the EV policies, implementation strategies, inter and intra-ministerial coordination and their effectiveness using the relevant data since 2011.

The paper confirms that the abysmal growth in electric vehicles can be attributed to exogenous factors rather than the successful implementation of government schemes. The lack of support infrastructure and limitations in the current vehicle technology are hampering the growth of this industry.

Results of the study show that meeting the reduction target of cutting greenhouse gas emissions intensity by 35% (approx.) below 2005 levels by 2030, as set by the government of India, will be challenging, requiring coordinated government efforts at various levels.

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