India’s EV Ecosystem to Increase Its FDI Inflow to USD 20 Billion by 2030

As per the latest report, India’s EV start-ups are expected to multiply their FDI by more than 300%.

A report released Thursday by Arthur D. Little, a management consulting firm, suggests that India’s electric vehicle startup ecosystem could attract up to USD 20 billion in FDI by 2030. The report, which did not include investments made by Original equipment manufacturers (OEMs) in the segment, and entitled “Unlocking India's Electric Mobility Potential” projects that over 30% of automobiles sold in the country will run on electricity by the year 2030 with sales surpassing 10 million.

EV adoption for the passenger vehicle segment is likely to amount to merely 10 percent by 2040, reaching about 5% of total sales. In order to surpass 30 percent EV adoption in India, the country will require nearly 800 GWh of batteries by 2030. To meet this rising demand and capitalize on government subsidies worth USD 2.3 billion and investment potential worth over USD 7.5 billion, India is accelerating plans to produce Li-ion cells within its borders as well as promote other battery technologies including solid-state batteries that could potentially cost less than USD 100 per kWh for large-scale deployment by 2025.

Several reasons have been attributed to India's lack of interest in adopting electric vehicles (EVs) as part of its road transport mix. This includes high upfront costs of EVs compared to their fossil fuel-powered counterparts, a small number of models on offer that appeal to the typical consumer, insufficient charging infrastructure and a severe lack of supporting infrastructure like charging stations, battery-swapping centres etc. The report also states that customers have no confidence in the safety standards surrounding EVs post a recent spate of accidents and fires involving EVs as well as lax government regulation for product safety in general which implies that there should be increased involvement from both the public and private sectors in order to clear up this lack of consumer confidence towards EVs thus paving the way for them to be adopted more widely across India.

Apart from the benefits of a cleaner environment, India is expected to save over USD 14 billion by 2030. This isn't all, though - the adoption of EVs is also expected to create 10 million jobs in India by 2030 as per the report.

READ ALSO:

Export Target of $1 Trillion to Be Achieved by 2030 Says MOS Finance

WEF President States India As a Bright Spot in Global Economic Arena