Abstract:

The Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI), launched by the Ministry of Heavy Industries (MHI) in March 2024, is a strategic policy initiative aimed at accelerating the domestic production of electric passenger vehicles. With a minimum investment threshold of ₹4,150 crore (approximately USD 500 million), the scheme is designed to attract global and domestic electric vehicle (EV) manufacturers to establish manufacturing operations in India.

The scheme offers key incentives, including a reduced customs duty of 15% on the import of up to 8,000 electric cars annually, provided they meet a minimum CIF value of USD 35,000. This import concession is valid for five years, with a clear mandate for approved applicants to commence local manufacturing within three years, ensuring significant domestic value addition.

By incentivizing investment and technology transfer, the scheme supports India’s goals of reducing fossil fuel dependence, lowering emissions, fostering innovation, and positioning the country as a global EV manufacturing hub. It also aims to create employment and contribute to India's broader climate commitments and industrial growth.