Hybrid carmakers seek sops, want clean mobility benefits

India can harness alternative technologies such as biofuels, strong hybrids, compressed natural gas

- Manas Pimpalkhare & Ayaan Kartik

Hybrid carmakers have approached the ministry of heavy industries seeking tax incentives, according to two people aware of the development, even as the automotive industry has raised concerns over tax parity for hybrids and pure electric vehicles.

"Hybrid makers are seeking tax-related benefits because the tax for clean mobility is lower. Electric vehicles have a goods and services tax of 5%, but hybrids are taxed at par with fossil-fuel vehicles," one person said.

Hybrid carmakers had approached the heavy industries ministry over the definition of clean mobility and highlighted the tax differential between fossil-fuel and hybrid vehicles, the second person said. The government will incentivize all forms of clean mobility, Mint reported on 6 June, citing heavy industries minister H.D. Kumaraswamy.

A draft of the Delhi EV Policy 2.0 proposing parity of incentives between zero-emission electric vehicles and hybrid vehicles sparked a debate in April, leading to consultations between the heavy industries ministry and automakers.