Electric Vehicle Industry in India
India's electric vehicle industry is witnessing unprecedented growth driven by government incentives, declining battery costs, increasing fuel prices, and growing environmental consciousness. With targets of 30% EV penetration by 2030 and strong policy support through FAME subsidies and PLI schemes, the EV ecosystem presents significant opportunities across manufacturing, charging infrastructure, battery swapping, and related services.
This comprehensive guide covers company registration, ARAI certification, PLI scheme benefits, FAME subsidies, charging infrastructure setup, and compliance requirements for EV businesses in India. Whether you're manufacturing EVs, setting up charging stations, or developing EV components, this guide provides the regulatory roadmap.
EV Industry Segments
EV Manufacturing
- • 2-Wheelers: Scooters and motorcycles (fastest growing segment)
- • 3-Wheelers: E-rickshaws and cargo vehicles
- • 4-Wheelers: Passenger cars and commercial vehicles
- • Buses: City buses and intercity coaches
- • Components: Motors, controllers, BMS, chargers
Charging Infrastructure
- • Public Charging Stations: CCS2, Bharat DC, AC charging
- • Home Charging: Level 1 and Level 2 chargers
- • Battery Swapping: Station and network operators
- • Fleet Charging: Depots and hubs
- • Software: Charging management systems
Battery Technologies
- • Cell Manufacturing: Lithium-ion cell production
- • Pack Assembly: Battery pack manufacturing
- • BMS: Battery Management Systems
- • Recycling: Battery recycling and second life
- • Alternative Chemistry: Solid-state, sodium-ion
Support Services
- • EV Financing: Loans and leasing
- • Insurance: Specialized EV insurance
- • Service Network: Maintenance and repair
- • Telematics: Fleet management solutions
- • Resale: Used EV marketplace
Company Registration for EV Businesses
Business Structure
Private Limited Company required for manufacturing. LLP suitable for charging infrastructure services and consulting. Consider separate SPVs for large manufacturing plants.
Company Incorporation
File SPICe+ on MCA portal. Select appropriate NIC codes for automotive manufacturing or services. Timeline: 10-15 days. Cost: ₹6,000-15,000.
Udyam Registration
Register as MSME for priority in government tenders, collateral-free loans, and PLI scheme eligibility. Essential for accessing FAME subsidies.
ARAI Certification
Mandatory ARAI type approval for all vehicles sold in India. Includes homologation testing for safety, performance, and emissions. Timeline: 6-12 months.
BIS Certification
Mandatory BIS certification for batteries, chargers, and electrical components. IS 16046 for Li-ion batteries, IS 17017 for charging systems. Timeline: 3-6 months.
CMVR Compliance
Compliance with Central Motor Vehicles Rules including AIS standards (AIS 038 for electric powertrain, AIS 156 for L category vehicles).
ARAI Certification Process
Automotive Research Association of India (ARAI)
ARAI is the premier testing and certification agency for vehicles in India. All EVs must obtain type approval before sale:
Testing Requirements
- • Safety testing (crash, braking, lighting)
- • Performance testing (range, acceleration, gradeability)
- • Battery safety (thermal runaway, abuse testing)
- • EMC (Electromagnetic Compatibility)
- • Environmental testing
Documentation Required
- • Technical specifications
- • CAD drawings and BOM
- • Component approval certificates
- • Quality management system (IATF 16949)
- • Prototype vehicle for testing
Applicable AIS Standards
- • AIS 038: Electric Power Train Vehicles - Construction and Functional Safety
- • AIS 156: Electric Power Train Vehicles of Category L (2 and 3-wheelers)
- • AIS 048: Battery Safety Requirements
- • AIS 049: Charging Systems
- • AIS 053: Construction of Vehicles (general requirements)
PLI Scheme for Automobile Sector
Production Linked Incentive Scheme
The PLI scheme for Automobile and Auto Components offers significant incentives for EV manufacturing:
Key Features
- • Incentive: 13-18% on determined sales value
- • Outlay: ₹25,938 crore over 5 years
- • Minimum investment thresholds apply
- • Domestic Value Addition (DVA) requirements
- • Sales and investment milestones
Investment Thresholds
- • 4-Wheelers: ₹2,000 crore minimum
- • 2/3-Wheelers: ₹1,000 crore minimum
- • Auto Components: ₹150-500 crore
- • Advanced Automotive Tech: ₹150 crore
Incentive Structure
| Category | Incentive Rate | Maximum Incentive |
|---|---|---|
| Electric 4-Wheelers | 18% (Year 1), reducing gradually | As per committed investment |
| Electric 2/3-Wheelers | 18% (Year 1), reducing gradually | As per committed investment |
| Auto Components | 13-18% based on technology | As per committed investment |
FAME India Subsidies
FAME II (Faster Adoption and Manufacturing of Electric Vehicles)
FAME II scheme provides demand incentives to EV buyers and subsidies for charging infrastructure:
Demand Incentives
- • 2-Wheelers: Up to ₹15,000 per kWh (max ₹60,000)
- • 3-Wheelers: Up to ₹10,000 per kWh
- • 4-Wheelers: Up to ₹15,000 per kWh (max ₹2.5 lakh)
- • E-Buses: Based on OEM price and operational cost model
- • Extended till March 2024 with enhanced outlay
Charging Infrastructure
- • Up to 100% subsidy for government entities
- • Emphasis on public and shared transport
- • Support for charging stations on highways
- • Battery swapping support
Eligibility for FAME Subsidy
- • Vehicle must be ARAI certified
- • Minimum top speed and range requirements
- • Maximum ex-factory price limits
- • Must have valid CEMF (Charger Equipment Management Facility)
- • OEM must be registered under FAME
Charging Infrastructure Setup
How to Set Up EV Charging Stations
Company Registration
Register as Private Limited or LLP. Obtain GST registration and Udyam registration.
Site Selection
Identify location with good visibility, parking space, and power availability. Consider malls, highways, petrol pumps, and commercial areas.
Power Connection
Apply for commercial power connection from DISCOM. Can be behind-the-meter (existing connection) or separate connection based on capacity.
CPO Registration
Register as Charging Point Operator (CPO) on centralized EV platforms. Comply with MoP Guidelines 2022.
Equipment Installation
Install BIS-certified chargers. Set up CCS2, Bharat DC, and/or AC charging points. Install necessary transformers and electrical infrastructure.
Software Integration
Integrate with charging networks and aggregators. Set up payment gateway and customer app.
Charging Standards
- • CCS2: Combined Charging System (DC fast charging)
- • Bharat DC: Indian standard for DC charging
- • Bharat AC: Level 2 AC charging
- • GB/T: Chinese standard (limited adoption)
- • Type 2: European standard (AC)
Investment Required
- • Level 2 AC: ₹50,000-2,00,000 per charger
- • DC Fast (30-50 kW): ₹5-15 lakh
- • DC Fast (150+ kW): ₹30-50+ lakh
- • Infrastructure: ₹2-10 lakh (transformer, civil work)
Battery Swapping Policy 2022
Battery Swapping Framework
The Battery Swapping Policy recognizes swapping as an alternative to charging, particularly for 2-3 wheelers and small 4-wheelers:
Key Features
- • Separate battery and vehicle registration
- • GST at 5% on batteries (vs 12% on vehicles)
- • Battery-as-a-Service (BaaS) model promoted
- • Interoperability standards being developed
- • Incentives under FAME for swapping stations
Business Models
- • Pure swapping station operators
- • OEM-led swapping networks
- • Third-party BaaS providers
- • Fleet-focused swapping
- • Integrated charging + swapping
State EV Policies
| State | Key Incentives | Manufacturing Benefits |
|---|---|---|
| Delhi | Purchase subsidy, road tax exemption, registration fee waiver | Capital subsidy, interest subvention |
| Maharashtra | Early bird subsidy, scrapping incentive, toll exemption | Stamp duty exemption, electricity duty waiver |
| Gujarat | Highest subsidies, extensive charging network plan | Subsidized land, capital subsidy up to ₹200 crore |
| Tamil Nadu | Purchase incentives, charging infrastructure subsidy | 100% SGST reimbursement, capital subsidy |
| Karnataka | First EV state policy, comprehensive incentives | Land allocation, R&D support |
Key Compliance Requirements
Vehicle Safety Standards
AIS 038/156 for EV safety, AIS 048 for battery safety, and compliance with CMVR requirements for registration and operation.
Battery Certification
BIS IS 16046 for Li-ion batteries, UN 38.3 for transport, and battery passport requirements for traceability.
Environmental Compliance
CPCB certification, E-waste management (EWM) rules compliance, and battery waste management rules.
Quality Management
IATF 16949 for automotive quality management, ISO 26262 for functional safety, and periodic audits.
EV Industry: Driving into the Future
With strong government support, growing consumer adoption, and improving infrastructure, India is poised for an electric mobility revolution. Early movers in the EV ecosystem stand to gain significant advantages.