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New Delhi: The government may consider rolling out export incentives for electric bus manufacturers keen to export buses to markets such as the UK and Europe, and even neighbouring nations such as Sri Lanka, Bangladesh and Nepal, even as it moves to incentivize state transport units to procure 10,000 electric buses each year, Mahesh Babu, global CEO, Switch Mobility, Ashok Leyland’s wholly-owned net zero e-mobility arm told Mint in an exclusive interview. According to Babu, India’s rate of procurement of e-buses lags its requirements, and should ideally double by 2030 to replace polluting internal combustion-engine buses on the road. That may call for extending sops to private bus operators who control nearly 90% of the bus market, under the new, redesigned FAME-III scheme, Babu said, adding that the government is likely to consider various measures to incentivize exports of e-buses too.
“The incentives could take the form of grants to neighbouring nations like Sri Lanka, Nepal and Bangladesh, drawing up free trade agreements (FTAs) with countries which can make export of buses to those economies attractive, as well as tapping into the existing production-linked incentive schemes (PLI) to aid exports,” Babu said. The government’s intent is also to extend incentives to private bus operators, as so far incentives are only limited to e-buses procured by state transportation undertakings (STUs), he said.
“Even if all the state transport undertakings were to only procure e-buses, that volume is approximately 10,000 buses a year. If they (the government) want to do more, then they have to give subsidies to private operators, but my assumption is that this figure of 10,000 buses by STUs will keep going up to 12,000-14,000 buses and so on. Actually, the number of buses procured by states needs to be more than doubled as per market requirements because India has low bus per 1,000 penetration, we are less than 1.5 buses per 1,000 people in the country, whereas many countries are at about three to six buses per 1,000 people. So if we achieve that, that’s a very favourable condition, but this scale up cannot happen with the current framework. We need payment security.”
“We need to bring in stakeholders like lease operators, fleet operators, leasing companies, financing companies to make this scale happen, which is what government is also looking at”, Babu said, adding, “Now we have to do this quickly because otherwise we’ll be lagging behind. We are also asking the government about looking at export incentives for e-buses, and if we can do that, then we have a huge potential of Europe, UK markets to be served to some extent from Indian market rather than from competing neighbouring countries”.
According to Switch Mobility, India’s e-bus adoption is not hindered by manufacturing capacities or investments as large companies like Ashok Leyland mark out a large capex towards electric buses and commercial vehicles, but hinges on policy decisions that can aid fast adoption and mitigate risks associated with deploying capital in this new technology.
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Updated: 21 Aug 2023, 11:35 PM IST
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