States woo electric vehicle makers as Centre steps back

India's states are racing to seize the electric vehicle (EV) manufacturing wheel, offering lucrative clean-energy policies as the Centre eases off the accelerator.

- Manas Pimpalkhare & Ayaan Kartik

From Maharashtra and Tamil Nadu to Karnataka and Andhra Pradesh, top manufacturing states have put in place new EV policies over the past two years, dangling land discounts, tax breaks and capital subsidies to woo EV makers and component suppliers.

Joining them soon are Gujarat and Haryana, which are scheduled to release their new clean energy policies within the next one year.

The development comes at a time when multiple key central government schemes to boost manufacturing in the EV sector have not had much effect due to delays in disbursals and tough localisation norms.

While production-linked incentive (PLI) schemes for EVs, their components, and batteries have seen low disbursal due to a stringent application process, the EV manufacturing scheme attracting foreign automakers to make in India saw more than a year delay in issuing guidelines for applying under the scheme.

Meanwhile, states are rushing in to fill the gap with attractive sops.

During Ather Energy's earnings call on 4 August, chief financial officer Sohil Parekh highlighted the subsidies it receives from the Maharashtra government for its upcoming plant.