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Uttar Pradesh: Electric vehicle policy offers major incentives, targets ₹30k crore investment, million jobs
Making Uttar Pradesh a global hub for manufacturing electric vehicles, batteries and associated equipment is among main objectives of the policy which offers a generous dose of subsidies and incentives
Uttar Pradesh has announced a new ‘Electric Vehicle Manufacturing and Mobility Policy 2022’ laced with a number of incentives and subsidies to attract investment of over ₹30,000 crore and generate direct and indirect employment for over a million (10 lakh) people.
Approved by the state cabinet at its meeting chaired by chief minister Yogi Adityanath here on Thursday, the policy also aims to make Uttar Pradesh a global hub for the manufacturing of electric vehicles, batteries and associated equipment. Creating an eco-friendly transportation system in the state is another key objective, the state’s finance minister Suresh Khanna said.
“The policy aims to attract investment of more than ₹30,000 crore and generate direct and indirect employment for over one million people,” Khanna said.
The policy provides a three-pronged incentive regime, one to consumers for purchasing, two to manufacturers and three to service providers for charging and battery swapping services. The policy provides capital subsidy and incentives at various stages.
Khanna said there would be 100% road tax and registration fee exemption on the purchase of all segments of EVs during the first three years of the effective period of the new policy. The same exemption would also be available in the fourth and fifth years if the EV had been manufactured in the state.
“Similarly, 15% subsidy will be given on factory cost for purchasing two-wheeler EVs up to maximum ₹5,000 per vehicle, subject to maximum first 2 lakh EVs purchased,” he said.
“The subsidy will up to maximum ₹12,000 per three-wheeler vehicle, subject to maximum first 50,000 EVs, up to ₹1 lakh per 4-wheeler vehicle, subject to maximum of first 25,000 EVs; up to ₹20 lakh per E-Bus on purchase of first 400 such buses,” he added.
Also, 10% subsidy on factory cost for purchasing E-goods carriers up to ₹1 lakh per vehicle to a maximum 1,000 E-goods carriers will also be provided.
“The new policy provides capital subsidy at the rate of 30% on investment subject to maximum ₹1000 crore per project to maximum first two ultra-mega battery projects, investing ₹1500 crore or more each for setting up battery manufacturing plant in the state with a minimum production capacity of 1 GwH,” Khanna said.
Similarly, capital subsidy at the rate of 30% on investment subject to maximum ₹1000 crore per project has been provided to maximum of first two Integrated EV Projects, investing ₹3000 crore or more each for setting up a manufacturing facility in the state for EV, EV Battery and related component manufacturing, including R&D, and testing facilities.
The first five mega EV projects investing ₹500 crore or more each and the first 5 mega EV Battery projects investing ₹300 crore or more are being provided capital subsidy at the rate of 20% on investment.
U.P. was one of the pioneering states with an EV Policy in August 2019. The policy, however, did not help much primarily due to the high cost of electric vehicles and lack of charging infrastructure at the time.
“Since the EV industry has evolved manifold during the last few years and multiple initiatives have been taken by the Centre since to promote electric mobility in the country, it became necessary for U.P. to bring a new and more aggressive EV policy,” said an official.
