Wednesday, June 25, 2025
By Kamal Swami
Register Online to Manufacture Electric Cars in India
With an aim to encourage the manufacturing of electric vehicles in the country, the government of India has officially initiated an online portal for companies to apply under the Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMPCI). EV manufacturers applying through this portal would be offered reduced customs duty for electric vehicle imports. The portal will remain open until October 21, 2025.
As per the scheme guidelines, global original equipment manufacturers (OEMs) can import Completely Built-Up Units (CBUs) of electric vehicles with a minimum Cost, Insurance, and Freight (CIF) value of USD 35,000 at a reduced customs duty of 15% for five years. The proposed custom duty is significantly lower than the existing rate of 70-110%., significantly lower than the current rate of 70-110%. However, this concession will be based on the actual investment and production commitments.To avail of the reduction in the custom duty, the EV manufacturing companies must invest at least Rs 4,150 crore in India and initiate the production of electric passenger cars within three years. The companies can import up to 8,000 units of electric vehicles per year.
According to the policy, it would be mandatory for electric car manufacturers to achieve domestic value addition (DVA) targets. These targets include achieving 25% DVA within three years and increase it to 50% by the fifth year. If any manufacturer fails to achieve these targets, in that case his bank guarantee would be forfeited. This guarantee is submitted as a safeguard for the customs duty forgone. This guarantee must be unconditional, irrevocable, and issued by a scheduled commercial bank in India.
In a recent update introduced in the policy, the final guidelines allow brownfield investments, on a condition of a clear physical separation from existing operations. The scheme now also invites investment in research and development (R&D) and electric vehicle charging infrastructure. Although there is no fixed amount determined for R&D expenditure within the committed investment amount, the manufacturers will have to invest 5% of the total investment on the development of charging infrastructure. The introduction of the scheme is a major step in India’s push toward the localization of electric vehicle production. At the same time, it also aims to attract global manufacturers along with creating a strong domestic EV environment.
