The Minister for Roads and Highways Transport (MoRTH) has no proposal under consideration to advise banks to offer cheaper car loans to electric vehicle buyers, the ministry said. Union chief Nitin Gadkari said in Parliament. His statement came in response to a question whether his ministry would recommend advising banks to lend at lower interest rates to purchase environmentally friendly vehicles.
Electric vehicles in the country are seeing a surge in demand in the past few days. While the segment is dominated by electric two- and three-wheelers, the passenger car segment is also seeing increasing penetration. This prompted major automakers to jump in and introduce electric cars. However, the high prices of these vehicles are preventing many consumers from buying electric vehicles.
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Even if the government has promoted electric mobility by providing subsidies and incentives under the FAME scheme, the price of electric cars in India after applying the benefits is still higher $10 lakh, this is a major barrier to the growth of the electric passenger car segment in the country. While some stakeholders have had a demand for cheaper interest rates on electric vehicle financing, the government is unwilling to introduce any such measures, at least for now, Gadkari has said. erase. “No such proposal is being considered in the Department of Road Transport and Highways,” the minister said.
Meanwhile, in announcing the 2023 Union Budget, Finance Minister Nirmala Sitharaman allocated an estimated $51.72 billion for FAME-2 plan for fiscal year 24 to encourage clean migration. In addition, the budget has also proposed eliminating customs duties on the import of tools needed to manufacture EV batteries in India. This move is expected to help reduce the price of electric vehicles in the country. In addition, the subsidy for electric vehicle batteries has been extended for one year, which will help make electric vehicles cheaper.
Date of first publication: February 6, 2023, 10:43 AM IST
