Author: PPD Team Date: 06/06/2025
The Ministry of Heavy Industries (MHI) has issued final guidelines for the “Scheme to Promote Manufacturing of Electric Passenger Cars in India.” The scheme supports India’s Make in India initiative and aims to attract global electric vehicle (EV) manufacturers.
Approved applicants will be allowed to import completely built-up (CBU) electric four-wheelers (e-4W) at a reduced customs duty of 15 per cent for five years. Imported vehicles must have a minimum cost, insurance, and freight (CIF) value of $35,000. Annual CBU imports are capped at 8,000 units, with unused quotas allowed to carry over.
The total customs duty foregone is capped at Rs 6.484 billion or the committed investment amount, whichever is lower. Brownfield investments are permitted, but must include a physically demarcated new manufacturing unit.
Eligible investment includes capital expenditure on plant, machinery, R&D, and associated infrastructure. Land acquisition is excluded. Investment in charging infrastructure is capped at 5 per cent of the committed amount.
Applicants must invest a minimum of Rs 4.15 billion within three years. There is no cap on maximum investment. Production of eligible EVs must begin within three years of approval. A minimum domestic value addition (DVA) of 25 per cent is required in three years and 50 per cent within five years. DVA will be certified under standard PLI (production-linked incentive) procedures by MHI-approved agencies.
A bank guarantee equal to the higher of the duty to be foregone or Rs 4.15 billion must be submitted and remain valid for the scheme’s duration. The non-refundable application fee is Rs 500,000. The application window will remain open for 120 days and may be reopened until March 15, 2026.
Eligible applicants must have global group automotive manufacturing revenue of at least Rs 10 billion and fixed assets worth Rs 3 billion, as per the latest audited financials.