Government Opens Portal for Electric Car Manufacturers
The Indian government has launched an online portal for companies to apply for its new electric vehicle manufacturing scheme. The Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMPCI) allows global carmakers to import Completely Built-Up Units (CBUs) of electric cars valued at a minimum of $35,000 at a reduced customs duty of 15% for five years.
To qualify for this benefit, companies must invest a minimum of Rs 4,150 crore in setting up manufacturing facilities in India and commence commercial production within three years. The scheme limits the number of cars that can be imported to 8,000 units per year. Manufacturers are also required to achieve 25% domestic value addition within three years, increasing to 50% by the fifth year.
The scheme includes several key provisions:
- Minimum investment of Rs 4,150 crore required
- Commercial production must start within three years
- Maximum of 8,000 electric cars can be imported annually
- 25% domestic value addition required within three years, increasing to 50% in five years
- Companies must provide a bank guarantee against customs duty forgone
Recent updates to the guidelines have expanded the scheme’s scope. Brownfield projects are now eligible, provided there is clear physical separation from existing manufacturing facilities. Investments in research and development (R&D) and electric vehicle charging infrastructure are also permissible, with charging infrastructure expenditure capped at 5% of the committed investment.
The application portal will remain open until October 21, 2025. Companies must back their investment commitments with an unconditional bank guarantee from a scheduled commercial bank in India. The guarantee will be invoked if the company fails to meet the minimum investment and domestic value addition criteria.
