It looks like the Government of India is all set to push for electric vehicles (EV) nationally. As part of FAME (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India), it has decided to hold talks to enhance the adoption of EVs. Power minister Piyush Goyal has spoken to various stakeholders, along with NITI Aayog, to explain how the economies of scale can make it more viable in India.
Currently in its pilot phase, FAME offers incentives of Rs 29,000 and Rs 1.38 lakh for two- and four-wheelers respectively. A nationwide roll-out is set to begin 1 April.
In July 2016, the road transport ministry had amended the Central Motor Vehicle Rules, 1989, (CMVR) to allow older vehicles to be retrofitted with a hybrid electric kit. This move was aimed at getting older vehicles to conform to Bharat-II norms, but that it would merely increase the number of low-quality hybrid kits in the market. Delhi’s ill-planned odd-even formula provided an exemption to compressed natural gas (CNG) and electric hybrid vehicles, but, again, this move would have given rise to low-quality kits in the market as a legal loophole for people who wanted to take out their cars.
The problem with EVs is a more chronic version of what plagues vehicles running on either CNG or liquefied petroleum gas (LPG). Lack of refuelling points is the biggest problem with gas-based vehicles, mainly due to the legal monopolies in place. EVs are more or less in the same boat, with Plug In India, a website that promotes the use of EVs listing 206 charging points in India. The figure stood at 194 in July 2016. Twelve new charging stations over a period of six months do not augur well for the ecosystem. Tata Motors in 2010 deferred the launch of the electric version of the Nano citing a lack of charging points, and seven years later, the Nano EV is nowhere in sight.
Public transport is marginally better off with buses covering short distances in urban sectors, and have the added benefit of returning to a depot at the end of the day to charge their batteries. This is where the Union government should direct its focus.
In December 2015, Prime Minister Narendra Modi flagged off an electric bus service designed by the Pune-based firm KPIT Technologies to be used in Parliament premises. However, nothing much has happened since then. In 2014, the Bengaluru Metropolitan Transport Corporation (BMTC) managed to acquire a fully electric bus from Chinese manufacturer Utopia for a two-month trial period. After that, however, the bus went back, and nothing happened after. Why? The cost of the bus was Rs 2 crore – too expensive for BMTC to afford.
As suggested earlier, Indian cities can slowly transition from diesel to electric buses if they start investing in the batteries required. Economies of scale play an important role. If we aggressively push for electric vehicles, we can make up for the cost of investment through reduced expenditure in operations.
To solve the problem, what needs to be addressed is demand and supply. There are two parts to the problem, vehicles and charging stations. The old-school method of pushing up the supply to create a demand will not work in a capitalist society like ours. Supply needs to cater to demand, and that is on a sticky wicket. Goyal solved it in the case of the lighting sector with the LED distribution scheme. In January 2014, under United Progressive Alliance-II, Energy Efficiency Services Limited (EESL) procured LED bulbs at Rs 310 a piece, one that fell sharply to below Rs 100 under Goyal.
In this regard, road transport minister Nitin Gadkari inviting Elon Musk’s Tesla Motors to set up a manufacturing base in India makes perfect sense. With Musk himself hinting at Tesla’s plans to ship to India soon, we can assume that 2018 might see a few of them in India. This will push up the supply and demand for Tesla cars in India, mainly due to the company’s brand value. The government should, logically, ensure that nothing stops Tesla legally from setting up charging stations similar to what Mahindra has done after its purchase of Reva Electric.
Public transport
Public transport needs to be prioritised. The simplest argument in favour of public transport is that it boosts productivity or, at worst, slows down the loss of productivity. In the case of a long trip, a commuter can catch up on reading, watch a film, take a nap or even work on their phone or laptop. The subsidy being given to cars and bikes needs to be extended to buses in order to solve the supply and demand problem. Public transport unfortunately is hindered by archaic laws that allow only government-run bodies to operate, penalising private entities who do. While that is a matter that needs to be sorted out by the centre with guidance from the Aayog, what Mr. Goyal and Mr.Gadkari need to do is:
1. Incentivise EVs for public transport
Public transport system is one of the largest consumers of commercial fuel. With the rise in traffic, the average mileage for buses in different cities has also gone down, resulting in an increase in the cost of purchasing fuel. In Mumbai, the fuel cost amounts to 18.2 per cent of the operational costs while in Bengaluru, it comes to 38.6 per cent. Since power supply is cheaper than fuel, the savings on fuel and the investment on the electric vehicle will balance each other out in the long run.
2. Set up a framework for private participation the charging point market
While long-distance bus operators might not go for electric buses, they can use their land resources to set up charging stations. Similarly, there needs to be a provision for anyone who wishes, to set up a charging station for vehicles.
3. Invest in education
Unless we invest in our education sector, research and development will not bear near-enough fruit. The reliance on foreign technology isn’t really a good idea in India with the varying ecosystem from state to state and issues with power.
The EVs market is just starting to take off. If Mr. Goyal can incentivise it, similar to the LED distribution scheme, the market will thrive, resulting in greater savings, a higher quality of travel and, most importantly, more jobs.
Recent Posts
- In the Large States category (overall), Chhattisgarh ranks 1st, followed by Odisha and Telangana, whereas, towards the bottom are Maharashtra at 16th, Assam at 17th and Gujarat at 18th. Gujarat is one State that has seen startling performance ranking 5th in the PAI 2021 Index outperforming traditionally good performing States like Andhra Pradesh and Karnataka, but ranks last in terms of Delta
- In the Small States category (overall), Nagaland tops, followed by Mizoram and Tripura. Towards the tail end of the overall Delta ranking is Uttarakhand (9th), Arunachal Pradesh (10th) and Meghalaya (11th). Nagaland despite being a poor performer in the PAI 2021 Index has come out to be the top performer in Delta, similarly, Mizoram’s performance in Delta is also reflected in it’s ranking in the PAI 2021 Index
- In terms of Equity, in the Large States category, Chhattisgarh has the best Delta rate on Equity indicators, this is also reflected in the performance of Chhattisgarh in the Equity Pillar where it ranks 4th. Following Chhattisgarh is Odisha ranking 2nd in Delta-Equity ranking, but ranks 17th in the Equity Pillar of PAI 2021. Telangana ranks 3rd in Delta-Equity ranking even though it is not a top performer in this Pillar in the overall PAI 2021 Index. Jharkhand (16th), Uttar Pradesh (17th) and Assam (18th) rank at the bottom with Uttar Pradesh’s performance in line with the PAI 2021 Index
- Odisha and Nagaland have shown the best year-on-year improvement under 12 Key Development indicators.
- In the 60:40 division States, the top three performers are Kerala, Goa and Tamil Nadu and, the bottom three performers are Uttar Pradesh, Jharkhand and Bihar.
- In the 90:10 division States, the top three performers were Himachal Pradesh, Sikkim and Mizoram; and, the bottom three performers are Manipur, Assam and Meghalaya.
- Among the 60:40 division States, Orissa, Chhattisgarh and Madhya Pradesh are the top three performers and Tamil Nadu, Telangana and Delhi appear as the bottom three performers.
- Among the 90:10 division States, the top three performers are Manipur, Arunachal Pradesh and Nagaland; and, the bottom three performers are Jammu and Kashmir, Uttarakhand and Himachal Pradesh
- Among the 60:40 division States, Goa, West Bengal and Delhi appear as the top three performers and Andhra Pradesh, Telangana and Bihar appear as the bottom three performers.
- Among the 90:10 division States, Mizoram, Himachal Pradesh and Tripura were the top three performers and Jammu & Kashmir, Nagaland and Arunachal Pradesh were the bottom three performers
- West Bengal, Bihar and Tamil Nadu were the top three States amongst the 60:40 division States; while Haryana, Punjab and Rajasthan appeared as the bottom three performers
- In the case of 90:10 division States, Mizoram, Assam and Tripura were the top three performers and Nagaland, Jammu & Kashmir and Uttarakhand featured as the bottom three
- Among the 60:40 division States, the top three performers are Kerala, Andhra Pradesh and Orissa and the bottom three performers are Madhya Pradesh, Jharkhand and Goa
- In the 90:10 division States, the top three performers are Mizoram, Sikkim and Nagaland and the bottom three performers are Manipur and Assam
In a diverse country like India, where each State is socially, culturally, economically, and politically distinct, measuring Governance becomes increasingly tricky. The Public Affairs Index (PAI 2021) is a scientifically rigorous, data-based framework that measures the quality of governance at the Sub-national level and ranks the States and Union Territories (UTs) of India on a Composite Index (CI).
States are classified into two categories – Large and Small – using population as the criteria.
In PAI 2021, PAC defined three significant pillars that embody Governance – Growth, Equity, and Sustainability. Each of the three Pillars is circumscribed by five governance praxis Themes.
The themes include – Voice and Accountability, Government Effectiveness, Rule of Law, Regulatory Quality and Control of Corruption.
At the bottom of the pyramid, 43 component indicators are mapped to 14 Sustainable Development Goals (SDGs) that are relevant to the States and UTs.
This forms the foundation of the conceptual framework of PAI 2021. The choice of the 43 indicators that go into the calculation of the CI were dictated by the objective of uncovering the complexity and multidimensional character of development governance
The Equity Principle
The Equity Pillar of the PAI 2021 Index analyses the inclusiveness impact at the Sub-national level in the country; inclusiveness in terms of the welfare of a society that depends primarily on establishing that all people feel that they have a say in the governance and are not excluded from the mainstream policy framework.
This requires all individuals and communities, but particularly the most vulnerable, to have an opportunity to improve or maintain their wellbeing. This chapter of PAI 2021 reflects the performance of States and UTs during the pandemic and questions the governance infrastructure in the country, analysing the effectiveness of schemes and the general livelihood of the people in terms of Equity.
Growth and its Discontents
Growth in its multidimensional form encompasses the essence of access to and the availability and optimal utilisation of resources. By resources, PAI 2021 refer to human resources, infrastructure and the budgetary allocations. Capacity building of an economy cannot take place if all the key players of growth do not drive development. The multiplier effects of better health care, improved educational outcomes, increased capital accumulation and lower unemployment levels contribute magnificently in the growth and development of the States.
The Pursuit Of Sustainability
The Sustainability Pillar analyses the access to and usage of resources that has an impact on environment, economy and humankind. The Pillar subsumes two themes and uses seven indicators to measure the effectiveness of government efforts with regards to Sustainability.
The Curious Case Of The Delta
The Delta Analysis presents the results on the State performance on year-on-year improvement. The rankings are measured as the Delta value over the last five to 10 years of data available for 12 Key Development Indicators (KDI). In PAI 2021, 12 indicators across the three Pillars of Equity (five indicators), Growth (five indicators) and Sustainability (two indicators). These KDIs are the outcome indicators crucial to assess Human Development. The Performance in the Delta Analysis is then compared to the Overall PAI 2021 Index.
Key Findings:-
In the Scheme of Things
The Scheme Analysis adds an additional dimension to ranking of the States on their governance. It attempts to complement the Governance Model by trying to understand the developmental activities undertaken by State Governments in the form of schemes. It also tries to understand whether better performance of States in schemes reflect in better governance.
The Centrally Sponsored schemes that were analysed are National Health Mission (NHM), Umbrella Integrated Child Development Services scheme (ICDS), Mahatma Gandh National Rural Employment Guarantee Scheme (MGNREGS), Samagra Shiksha Abhiyan (SmSA) and MidDay Meal Scheme (MDMS).
National Health Mission (NHM)
INTEGRATED CHILD DEVELOPMENT SERVICES (ICDS)
MID- DAY MEAL SCHEME (MDMS)
SAMAGRA SHIKSHA ABHIYAN (SMSA)
MAHATMA GANDHI NATIONAL RURAL EMPLOYMENT GUARANTEE SCHEME (MGNREGS)