Budget 2024 gives a major push to e-vehicles with special focus on PLI scheme

In a major push to promote the automobile industry, with a special focus on e-vehicles, the budget provisions for the production-linked incentive (PLI) scheme for automobile and auto components have increased by a whopping 624 per cent. The scheme has been allotted Rs 3,500 crore against Rs 484 crore in the revised estimates for 2023-24.

This comes after the scheme attracted the proposed investment of Rs 67,690 crore, against which investment of Rs 14,043 crore have been made till the March-end, as per the Economic Survey 2023-24. Applicants have proposed employment generation of 1.48 lakh, against which 28,884 of employment has been generated, the survey added.

Within the auto sector, special focus has been given to the e-vehicle segment. The Electric Mobility Promotion Scheme (EMPS) 2024, launched in March 2024, remained on the priority list of the government with Rs 500 crore allotted to the scheme, which was originally to be completed by July 31. EMPS aims to accelerate the adoption of electric two-wheelers (e-2W) and three-wheelers (e-3W), focusing on commercial and certain private-use vehicles. It looks to support 3,72,215 EVs including e-2W (3,33,387) and e-3W (38,828 including 13,590 rickshaws & e-carts and 25,238 e-3W in L5 category). EMPS 2024 will provide further impetus to the green mobility and development of electric vehicle manufacturing in the country. Aligning with the Atmanirbhar Bharat initiative, phased manufacturing programme has been adopted which encourages domestic manufacturing and strengthening of EV supply chain. This shall also create significant employment opportunities in the EV sector.

Another PLI scheme for the National Programme on Advanced Chemistry Cell (ACC) Battery Storage has also received a significant hike of Rs 250 crore from just Rs 12.01 in revised estimate for 2023-24, reiterating the government’s focus on the e-vehicle sector.

While PLI scheme for Automobile and Auto Components, launched in September 2021, aims to enhance domestic manufacturing by giving financial incentives to companies, PLI for (ACC) Battery Storage envisages incentivising large domestic and international players in establishing a competitive ACC battery set-up in the country. ACCs are the new generation of advanced storage technologies that can store electric energy either as electrochemical or as chemical energy and convert it back to electric energy as and when required. Through the scheme, the sectors that are major battery consuming, such as electronics, electric vehicles, advanced electricity grids, solar rooftop etc. are expected to achieve robust growth in the coming years.

Both the schemes are implemented by the heavy industries ministry.