It offers investors in the region a 15 percent capital subsidy on the value of fixed assets over five equal annual payments, with a maximum land area of 50 acres, and a production-linked subsidy of 1 percent on turnover. The latter will be awarded to large EV assembly and manufacturing units for five years starting from the first year of commercial operation.
But such incentives haven’t helped consumers: prices of electric vehicles in the state haven’t come down as they expected. Take the example of the recently launched electric scooter. According to reports, its two variants in Karnataka are priced at Rs 99,999 and Rs 1.2 lakh. In Gujarat, they will be available for Rs 80,000 and Rs 1 lakh and in Delhi for Rs 85,000 and Rs 1.1 lakh.
By not offering subsidies to EV buyers, the Karnataka government appears to be shielding itself from further pandemic-triggered financial shocks and cuts in central transfers of funds.
“Our electric vehicle policy is directed to ensure that more manufacturers come to Karnataka instead of increasing sales. We are hopeful that the subsidy provided by the government to this sector will eventually be passed on to the consumers,” said the Additional Chief Secretary, Industries Department EV Ramana Reddy.
According to a senior industry department official, it is ready to include incentives for buyers in the policy, but the finance department is not in a position to confirm such a move. “The finance department has cited fund crunch due to the pandemic,” the official said.
Another official said that the government may consider some steps to boost the sale of electric vehicles. “It is looking at the possibility of providing subsidy of a certain amount to a limited number of consumers for 50,000 to 1 lakh two-wheelers and three-wheelers in the EV segment,” he said.
industry minister Murugesh R Nirani We believe that it may be very difficult to pass concessions directly to consumers due to the existing financial constraints. “While Maharashtra and Gujarat may be keen to increase demand, our policy is towards increasing supply. We believe that the existing policy and discounts given to manufacturers will bring down the base price of the vehicle and the price will eventually match the rates of other states.”
He said the government will study EV pricing in other states to find out how Karnataka can compete. Karnataka unveiled an EV policy in 2017, becoming the first state to do so. Later it was amended.
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