Interestingly, India itself presents a substantial demand on the automotive front. This would help in catering to domestic demand and in time to scale up to export market as well. Overall, this could possibly lead to a boost for global suppliers to set up in India, as well as for domestic companies for infusing additional investment. The push to components industry will certainly add to the effectiveness of the scheme in terms of attracting investors for creating new/additional capacities. On the components side, the coverage of components under the Advanced Automotive Technology are yet to be notified for scheme eligibility. However, core to addressing demand side concerns are the next areas of focus in aspects such as vehicle charging infrastructure, battery ecosystem for longer range technologies and bank finance facilities for purchase of these vehicles. This coupled with corporate tax deductions and lower GST rates may aid in creating a demand side push. This could be supported by incentives available on the demand side, such as FAME-II as well as multiple state EV policies such as those in Maharashtra, Gujarat and Delhi that provide subsidies to end customers on purchase of EVs. However, consumer readiness for switching from conventional models to these models will play a critical role in determining the domestic demand. This has also been supported by the state incentives available under the state industrial policies. On the vehicles side, the automotive PLI policy addresses investment as well as the supply side push for Battery Electric Vehicles and Hydrogen Fuel Cell Vehicles of all segments. With Liberalised Policy and PLI Scheme, Drone Sector Has Got Wings to Fly HighĪLSO READ | Amitabh Kant Writes: Vehicle Scrappage Policy a Groundbreaking Step towards Cleaner Mobility

Larger themes under the automotive PLI appear to be-reduction in import dependencies, localization of superior technologies, wider adoption across segments, affordability for India market and projecting India as an export hub. With the recent automotive PLI (production-linked incentive) policy, India has attempted to foray into the high value Advanced Automotive Technology vehicles and components space. The adaption to newer technologies has witnessed slower growth until now, since advanced and sophisticated technologies have been mostly limited to high-end vehicle models. The Indian automotive industry is largely dominated by players specializing in conventional fuel models, known as ICE vehicles-which are propelled by an Internal Combustion Engine. The scheme is expected to provide impetus to the industry that has been grappling with lower volumes over the last couple of years. The much-awaited PLI scheme for the automobile industry was approved by the Cabinet on September 15, 2021, with a trimmed budgetary outlay of Rs 26,058 crore.

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