Demand for EVs likely to increase by 2030

Demand for EVs likely to increase by 2030

India’s market for EVs for commercial use is expected to grow to $15-20bn in the next five years

The demand for Electric Vehicles (EVs) for commercial use (as a taxi) is estimated to increase by 2030 as demand surges because of the rise in fuel prices, according to officials who are working on the EVs project in the country.

Meanwhile, an incentive has been already rolled out by the government, which makes EVs a lot more affordable with low-interest rates and smaller EMIs.

“In July and August alone, there has been a three-fold increase in demand compared to the pre-pandemic years. We expect a rise in demand compared with the pre-pandemic times,” said an official.

However, with the government aggressively encouraging the use of e-mobility to cut down on crude oil imports and reduce vehicular pollution, major e-commerce companies have started looking at electrifying their delivery fleet and are placing orders for new products.

“The momentum is already there, a sizable scale will kick in in the coming years,” an official said, adding that estimates show India’s market for EVs for commercial use to grow to $15-20bn in the next five years.

He shared that economics alone will propel the drive towards EVs — the running cost per km for an electric vehicle for commercial use is free at a charging station in the country unlike for a petrol or a diesel vehicle.

 “There is already a sharp uptick in demand for EVs for commercial use in the country, where the government is already in completion of the EVs road map 2035,” he said.

He added that due to lack of expertise in the country, they still face issues related to installation of charging points and certification of some vehicles. “We are still learning on these pilot projects,” he added.

The objective of this initiative is to facilitate faster transition to green technologies in the urban delivery segment to reduce emission, and simultaneously leverage the volumes to enable the establishment of a charging infrastructure and vendor base for the EVs.

Given the rapid growth in e-commerce — accelerated now by the pandemic — as many as 300 taxis are expected to be on the road in the urban delivery segment by 2030, as a pilot project of the government.

 Meanwhile, by this time of the year, around 300 taxis should have been replaced by EVs. But only around 25 EV taxis are on the road as of today.

 The EV project is a Global Environment Facility-supported project, where taxi drivers are given a subsidy of US$ 5,500 if they purchase an EV that costs Nu 1.9 million and above. They are also given 70% of the loan without any collateral from the Bank of Bhutan.

 Meanwhile, more than 300 taxi drivers have registered for this scheme and demand is in the surge. Some of them sold their old fuel taxis only to find out that the delivery of their EVs was delayed due to the pandemic.

    Further, the project unit under the Office of the Prime Minister released a subsidy for 135 EVs to four motor dealers in the country so far. Kuenphen Motors, which has the highest order for 123 EVs, has delivered eight vehicles so far.

 “Because of the disruption in the supply chain we are facing inevitable delay. Also, we do not have direct vessel service from Shanghai to Kolkota. Ultimately, the tranship port is either Malaysia or Singapore,” an official said.

 He added that usually, under normal situations, the transhipment at any connecting port should be available within a week. But, at this moment, transhipment at the connecting ports is taking a minimum of 14 to 21 days.

 However, the Indian Embassy in Bhutan in collaboration with the Ministry of Heavy Industries, Government of India; the Federation of Indian Chambers of Commerce & Industry (FICCI); the Society of Automobile Manufacturers (SIAM); and the Bhutan Chamber of Commerce and Industry (BCCI) organized a virtual meeting between Indian (exporters) manufacturers and Bhutanese (importers) dealers to promote Indian EVs in Bhutan including two-wheelers, mid-size passenger EVs, buses, and trucks on November 18.  

Given that there is an increasing demand for EVs in Bhutan as well as keeping in mind the target to ensure 50% of the vehicle fleet in the country is converted to clean and eco-friendly technology by 2030, Ambassador of India to Bhutan Ruchira Kamboj said that this virtual meeting was aimed at expanding the presence of Indian-manufactured EVs in Bhutan.

Given India’s growing capacities on this front and Bhutan’s efforts to “go electric”, Ambassador Kamboj stated that there was a clear case for synergy and collaboration between the two countries on this front.

Meanwhile, the Ministry of Information and Communications started the Bhutan Sustainable Low Emission Urban Transport system about two years ago. It was to maintain the country’s commitment to the international community to remain carbon neutral for all times to come.

The 300 EV taxis are expected to reduce 43,000 tons of the country’s carbon dioxide emission within nine years. A car is estimated to release close to 16 tons of carbon dioxide into the atmosphere every year.

Kinley Yonten from Thimphu