Investor Perspectives on Accelerating Growth in the Indian EV Ecosystem

The report examines India's transition to electric mobility, highlighting the success of demand-side incentives like FAME II for two- and three-wheelers. It identifies critical investment gaps in charging infrastructure and battery manufacturing, while discussing the potential of battery swapping and the risks posed by global supply chain dependencies on China and other mineral-rich nations. The analysis emphasizes the need for binding targets, improved consumer financing, and workforce retraining to ensure a competitive and just transition.

• India's FAME II scheme has significantly boosted EV demand by increasing subsidies tenfold to $1.35 billion compared to phase I, specifically accelerating the adoption of two-wheelers (2W) and three-wheelers (3W).
• Consumer financing remains a major barrier, with electric 2Ws facing higher interest rates and down payments than internal combustion engine vehicles; proposed solutions include a $300 million first-loss risk-sharing instrument and including EVs in priority sector lending.
• Charging infrastructure is a critical bottleneck, with only about 1,800 public stations available. Investors identify land availability and electricity grid readiness as the primary obstacles to deployment.
• Battery swapping is viewed as a viable solution for urban centers to reduce upfront costs and land requirements, though it is currently hindered by a lack of interoperability and a higher tax rate (18 percent) compared to fixed batteries (5 percent).
• India aims to establish 50 GWh of local battery manufacturing capacity through the Production Linked Incentive Scheme for Advanced Chemistry Cell Batteries (PLI-ACC), which offers $2.5 billion in subsidies over five years.
• The Indian EV supply chain is highly vulnerable to geopolitical tensions and global shortages, particularly regarding battery cells, semiconductors, and raw metals, with China controlling 75-80 percent of refining and cell manufacturing.
• To improve global competitiveness, investors suggest India move from enabling policies to binding targets for EV penetration and tighten fuel economy standards, which currently lag behind the EU, US, and China.
• There is a significant skill gap in the labor force, particularly in R&D and the transition of ICE mechanics to EV servicing, necessitating state-led vocational training and retraining initiatives.

APA

Moerenhout, T., Goel, S., Aneja, D. A., Bansal, A., & Ray, S. (2022). Investor Perspectives on Accelerating Growth in the Indian EV Ecosystem. International Institute for Sustainable Development. https://www.iisd.org/system/files/2022-08/investor-perspectives-growth-indian-electric-vehicle-ecosystem.pdf

Chicago

Moerenhout, Tom, Siddharth Goel, Dev Ashish Aneja, Abhishek Bansal, and Saon Ray. Investor Perspectives on Accelerating Growth in the Indian EV Ecosystem. International Institute for Sustainable Development, 2022. https://www.iisd.org/system/files/2022-08/investor-perspectives-growth-indian-electric-vehicle-ecosystem.pdf.

Wikipedia

{{cite report |last1=Moerenhout |first1=Tom |last2=Goel |first2=Siddharth |last3=Aneja |first3=Dev Ashish |last4=Bansal |first4=Abhishek |last5=Ray |first5=Saon |title=Investor Perspectives on Accelerating Growth in the Indian EV Ecosystem |publisher=International Institute for Sustainable Development |date=August 2022 |url=https://www.iisd.org/system/files/2022-08/investor-perspectives-growth-indian-electric-vehicle-ecosystem.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{moerenhout2022investor, author = {Moerenhout, Tom and Goel, Siddharth and Aneja, Dev Ashish and Bansal, Abhishek and Ray, Saon}, title = {{Investor Perspectives on Accelerating Growth in the Indian EV Ecosystem}}, institution = {International Institute for Sustainable Development}, year = {2022}, month = aug, url = {https://www.iisd.org/system/files/2022-08/investor-perspectives-growth-indian-electric-vehicle-ecosystem.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }