EV Firms Urge Faster, More Inclusive Incentive Schemes

Automakers argue India's EV schemes don't match the speed of industry investments

- Ayaan Kartik

A foreign car company and two local automakers have questioned the implementation of incentive schemes to promote local manufacturing, laying bare a divide between policy wonks and the industry. Vietnamese EV firm VinFast said it became ineligible for incentives designed to attract foreign carmakers because it started investing in the country before the scheme was notified.

"That policy was drafted when we were considering entering India. Now, our cars are rolling out from our Indian factory," Pham Sanh Chau, chief executive officer (CEO) of VinFast Asia, said on the sidelines of the firm's official launch in India on Saturday. The executive added that the pace of policymaking does not match the pace of investment decision-making at companies.

VinFast signed a memorandum of understanding with the Tamil Nadu government in January 2024 to set up an integrated EV plant in the state. The Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) was approved in March 2024 and was notified more than a year later, in June 2025.

The scheme allows EV makers to import a limited number of vehicles at reduced customs duties if they invest a minimum of ₹4,150 crore in the country and meet domestic value-added requirements.