"I firmly believe that we are on to an amazing transformation in our industry and will build an enormous global behemoth out of India in E2Ws (electric two-wheelers). However, there's still a lot to solve for," Mehta wrote in response to an article by India's G20 Sherpa Amitabh Kant who highlighted the need for electrification of transportation in India.
Mehta further said, "While tech and products are evolving, customer adoption is still at 5-6%, and policy support is a crucial signal to all stakeholders that the government stays committed to a 100% electric vision."
Demand incentives remain central to this as they have the highest output per rupee spent. Demand acceleration paves the way for more capacities, more infrastructure, more research and development, more products, more suppliers, and a larger ecosystem, he added.
"Subsidies are not about helping companies grow; they're about accelerating adoption for the entire industry," Mehta asserted.
He acknowledged that back in 2021, when the government introduced favourable EV policies, they provided much-needed support to the fledgling EV industry. This support was crucial in making EVs economically viable for consumers while allowing EV startups to invest in R&D at previously unheard levels, especially for a new industry.
"This has allowed the industry to brutally cut costs and expand its portfolio and infrastructure on all fronts," Mehta added.
The revised FAME policy last year happily coincided with the industry's ability to bring down costs through innovation and economies of scale, reducing reliance on subsidies, he said, adding, "with reduced maximum benefits per vehicle (from Rs 55,000 to Rs 10,000), the government can now support 5X E2W transition".
Responding to critics of electrification, he said, "Naysayers in the industry will keep nitpicking on new tech, but there's perhaps no single lever more powerful than 100% electrification to reduce fossil fuel dependence and emissions reduction.
"Electrification coupled with 'green-ification' of power generation with solar and wind is an incredibly simple and powerful level for our country today," he added.
Mehta pointed out that demand incentives coupled with localisation targets end up driving a strong local component ecosystem, a crucial step towards establishing India as an EV manufacturing hub.
Promoting localisation helps in reducing dependence on imported components and fosters a self-sustaining industry, driving export growth and cementing India's position as a global leader in the EV revolution, he added.
"Electrification coupled with 'green-ification' of power generation with solar and wind is an incredibly simple and powerful level for our country today," wrote Mehta.
Rival Ola Electric founder and CEO Bhavish Aggarwal also wrote on X in support of electrification.
"ICE (internal combustion engine) is inflationary. EV is deflationary. (It is) only a matter of time before the purchase price of EVs becomes much lower than ICE vehicles. China is already there," he wrote.
Aggarwal further said, "All formats of ICE, Hybrid, CNG etc will be costlier than EVs in the near future. Those companies not believing in EVs are making a strategic mistake."
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