The Economic Survey 2022–23 says that by 2030, the Indian market for electric cars (EVs) will sell one million units per year and directly and indirectly create five million jobs. According to the survey presented to Parliament on January 31, India surpassed Japan and Germany to become the third-largest vehicle market in December 2022 in terms of sales.
The survey emphasized that the move to green energy is anticipated to be significantly aided by the car sector. Between 2022 and 2030, the domestic electric vehicle (EV) market is anticipated to expand at a compound annual growth rate (CAGR) of 49%, reaching annual sales of 1 crore units by that time.
According to industry projections, India’s total EV sales in 2022 will be close to 10 lakh units. Additionally, the survey noted, “By 2030, the EV sector would generate 5 crore direct and indirect jobs. To promote and nurture its development, the government has taken several actions”.
The pre-budget report also emphasized the importance of the auto industry to India’s economy. India surpassed Germany and Japan to become the third-largest vehicle market in December 2022, according to the statement’s conclusion. India was the world’s top producer of two- and three-wheelers as well as the fourth-largest producer of passenger automobiles in 2021.
According to the report, the sector will create 3.7 crore direct and indirect jobs by the end of 2021, contributing 7.1% to the overall GDP and 49% to the manufacturing GDP. According to the survey, the government’s Faster Adoption and Manufacturing of Electric Vehicles (FAME) II scheme, which has a budget outlay of 10,000 crore between 2019 and 2024, has encouraged the production of 7.1 lakh EVs and sanctioned 7,210 e-buses, of which 2,172 e-buses have been put into service as of December 2022.
A million two-wheelers, 500,000 three-wheelers, 55,000 vehicles, and 7,090 buses were planned to be supported under the plan. The Automotive Component Manufacturers Association of India (ACMA) says that domestic demand, especially for passenger cars, helped the auto components industry grow by 34.8% in the first half of 2022–23 to reach 2.65 lakh crore. Component exports increased by 8.6% to $10.1 billion (79.03 lakh crore) during the time period, while imports increased by 17.2% to $10.1 billion (79.8 lakh crore). The industry saw an increase in revenue from 2020–21 to 2021–22, reaching ₹4,20,621 crore.
Despite the optimistic forecast, the automobile industry still has to deal with issues including increasing borrowing rates and a slowing global economy, according to the survey.
The survey found that the cost of upfront insurance increased by 10–11% as a result of a rise in long-term, third-party car insurance premiums, particularly for two-wheelers. The two-wheeler market is therefore the most hit and has experienced the lowest sales over the past 10 years. Addressing these issues will help the vehicle sector, according to the report.