TL;DR
Most electric vehicles in India fail to meet the domestic content requirements for government PLI incentives, indicating a significant reliance on imported components, primarily from China.
A recent report reveals that a significant majority of electric cars sold in India, specifically 40 out of 46 models, do not meet the domestic value addition norms required to qualify for government incentives under the Production Linked Incentive (PLI) scheme. This is primarily due to their heavy reliance on imported parts, with over 60 percent foreign content in most cases.
The PLI scheme, managed by the Ministry of Heavy Industries, mandates at least 50 percent domestic value addition, with a concession allowing 40 percent if battery cells are excluded. Only six EV models currently qualify, with Tata Motors accounting for five (Nexon EV, Punch EV, Harrier EV, Tiago EV, Tigor EV) and Mahindra contributing one (XEV9E).
This highlights the substantial challenge the Indian automotive industry faces in building a genuinely local EV supply chain. While some manufacturers like Hyundai are taking steps towards deeper localization by assembling battery packs, true localization in critical child parts, raw materials, semiconductors, and advanced battery chemistry is still lacking, leading to a continued dependence on imports.
