As the world is adopting a carbon-neutral economy and moving toward a sustainable mode of transportation. The demand for electric vehicles has grown significantly from the global south to the global north.
The US and Europe have emerged as the leading players from the global north and captured the maximum market share globally. On the other hand, China, dominate the electric vehicle market in the global south region. In this, India has taken several steps to boost its EV position across the globe.
How Big is the Indian Electric Vehicles Market?
Since 2013, the Indian govt has implemented several policies to prepare the environment for electric vehicles. Due to these steps, local EV manufacturers dominate the domestic market and have registered digit growth over the years. As per the growth trajectory, the market value is about to cross the USD 100 billion mark by the decade’s end. To make this possible, the government has introduced changes in existing EV policies to attract fresh investment.
India’s EVs Export and Import Globally
Diving deep into the Indian electric vehicle market, one may find that the electric vehicles market is strong enough to dominate the industry. For instance, total sales are more than 1.7 million units in 2024. It’s also estimated that manufacturing capacity will be able to get the 1/3 of the market share by 2030. Let’s explore India’s exports and imports.
Nepal became India’s top export destination for Electric vehicles in Q1 of 2024 with USD 9.8 million. Interestingly, the Indian export market is more Asia-oriented, which means that Indian EV manufacturers found it easier to export in Asia than in other regions.
On the other hand, India’s import values have increased over the years, for instance, Germany and China, export USD 16.8 and USD 15.1 million EVs to India in the first of quarter of 2024. This captivated Germany, China, and the US to explore the untapped Indian market.
| Countries | Q1 2024 Exports | Countries | Q1 2024 Imports |
|---|---|---|---|
| Nepal | 9,876 | Germany | 16,823 |
| Japan | 7,067 | China | 15,149 |
| Germany | 1,593 | US | 8,331 |
| Vietnam | 416 | Hungary | 1,978 |
| Australia | 413 | UK | 886 |
India’s Electric Vehicles Trade Performance
In the last couple of years, the Indian electric vehicle market has achieved remarkable growth. For instance, exports to Germany, Nepal, and France rose by 556%, 82.9% and 76.7% respectively in 2023, compared to 2022.
The rise in exports shows that Indian manufacturers can meet foreign demand. Further, these light on the policies brought by the govt to expand the base, and attract foreign manufacturers.
| Top Export Destinations | Exports In 2022 | Exports in 2023 |
|---|---|---|
| Nepal | 32,636 | 59,691 |
| France | 30,135 | 53,255 |
| Germany | 503 | 3,304 |
| Bhutan | 216 | 603 |
| South Korea | 182 | 344 |
India EVs Dependency
India’s imports in the last two years reveal dependency on electric vehicles has increased to a new height. This highlights emerging demand and opportunities for foreign manufacturers to fill the market gap. Let’s explore the source from India Import EVs –
Notably, India’s EV import increased by 157.8% in 2023, compared to the last year. If categorising this based on countries, Sweden and China emerged as the largest suppliers of EVs to India with a significant increase of 452.6% and 299% respectively, in 2023. For a comprehensive view, check the table.
| Top Origin Countries | Import In 2022 | Import in 2023 |
|---|---|---|
| World | 89,271 | 230,210 |
| Germany | 54,822 | 131,364 |
| South Korea | 18,505 | 31,586 |
| Sweden | 5,618 | 31,047 |
| China | 5,077 | 20,284 |
| UK | 3,553 | 8,240 |
Top Components for Electric Vehicle Market?
The market share of EVs is continuously evolving with double-digit growth. This immense growth is also helping businesses that are associated with the EV manufacturing process. Let’s discover the main components required for the EV industry and their market value. Here’s a quick view –
In 2023, the export and import of lithium-ion batteries rose by 24.5% and 30.8 % globally, compared to the previous year. On the other hand, the trade of electrical capacitors declined by USD 4.1 and USD 2.7 in the same period. For a comprehensive analysis, check the table –
| Products | Imports | Exports | ||
| 2022 | 2023 | 2022 | 2023 | |
| Electrical Transformer | 144.0 | 155.4 | 145.1 | 155.7 |
| Lithium-Ion-Accumulator | 89.0 | 116.5 | 100.2 | 124.8 |
| Electrical Capacitors | 40.3 | 36.5 | 37.2 | 34.3 |
| Machinery and plant equipment | 49.3 | 53.2 | 47.1 | 51.4 |
| Electrical Resistors | 15.4 | 12.7 | 16.0 | 11.9 |
How Does a New EV Policy Benefit the Business?
To establish India as a Global Electric vehicle supplier, the govt is introducing changes in the EV policies. Here’s a quick view of the upcoming policies –
Incentive to Existing Players
Over the years, the demand has been raised to provide financial assistance and tax benefits to existing companies or manufacturers. To consider this, Govt is giving tax rebates and financial assistance to strengthen the manufacturing process.
Boosting Domestic Manufacturing
To safeguard the interest of domestic manufacturers and establish a competitive work environment, the govt is giving financial assistance and tax rebates.
Covering Petrol and Diesel Plants
Vehicle manufacturers are continuously raising their voices to include the parts of both petrol and diesel manufacture alongside electric vehicles.
The market for eco-friendly vehicles is too large and presents a trillion-dollar export and import opportunity. Hence, it becomes important for the Govt to establish an ease-of-doing-business environment through financial assistance and relaxation in tax duties.
