The decision to provide subsidies for charging infrastructure under the PM E-DRIVE Scheme marks a critical shift in policy focus, ensuring that EV adoption is not just incentivized but also supported with the necessary ecosystem. This move will accelerate the growth of e-2Ws and e-3Ws, which form the backbone of India’s urban mobility, says Sumeru Shah, Business Head – Electric Vehicles, Ecofy in an interview with EVolution Auto India.
Q: How has the PM E-DRIVE Scheme accelerated EV adoption in India, and how does it align with the 30 percent EV penetration target by 2030?
Sumeru Shah: The PM E-DRIVE Scheme has emerged as a major game-changer in facilitating the electric vehicles revolution in India (EVs), making them more accessible and affordable. By extending direct subsidies on EV purchases, the scheme has significantly reduced the upfront cost for consumers, thereby driving higher adoption rates. More importantly, for the first time, the scheme allocates funds toward developing charging infrastructure which addresses a critical bottleneck that has long hindered EV adoption in India. The privatization of a widespread and reliable charging network has been one of the biggest deterrents to mass EV adoption, and this focused investment will surely aid in catalysinggrowth across the ecosystem. By improving affordability and infrastructure capabilities, the scheme nudges India a step closer to achieving its ambitious 30 percent EV penetration target by 2030.
Q: What progress has been made in charging infrastructure for e-2Ws and e-3Ws, and what gaps still need to be addressed?
Sumeru Shah: The decision to provide subsidies for charging infrastructure under the PM E-DRIVE Scheme marks a critical shift in policy focus, ensuring that EV adoption is not just incentivized but also supported with the necessary ecosystem. This move will accelerate the growth of e-2Ws and e-3Ws, which form the backbone of India’s urban mobility. However, key challenges continue to remain. For instance, the high cost and limited availability of real estate for charging stations, poses significant economic constraints. Addressing these structural issues will be essential to scaling the infrastructure rapidly and ensuring that charging access does not become a roadblock to EV penetration.
Q: What are the key risks and rewards for investors & stakeholders in the evolving EV sector, and how can they be effectively managed?
Sumeru Shah: The EV sector presents a compelling investment opportunity, but it is not without risks. Rapid technological advancements mean that today’s solutions can quickly become obsolete, posing a challenge for long-term investments. Additionally, emerging alternatives such as hydrogen and India’s continued reliance on CNG present competitive risks. However, the rewards are significant as early movers stand to gain premium returns as the sector scales. The key to mitigating risks lies in continuous R&D investment, ensuring that innovation keeps pace with market evolution. Stakeholders who prioritize adaptability and invest in cutting-edge solutions will be best positioned to reap long-term benefits.
Q: How are NBFCs and financial institutions driving EV adoption through innovative financing models, and how is the government supporting risk mitigation in EV lending?
Sumeru Shah: While the government has yet to introduce dedicated risk mitigation measures for EV financing, proposals such as classifying EV financing under Priority Sector Lending (PSL) could be a game-changer if approved by the RBI. In the meantime, NBFCs are stepping up with innovative financing models that reduce the financial burden on consumers and businesses. Solutions like Battery-as-a-Service (BaaS) allow customers to pay for battery usage on a subscription basis, significantly lowering the upfront cost of EV ownership. Leasing models are also gaining traction, particularly among fleet operators, as they eliminate the need for high capital investments. By pioneering these financial innovations, NBFCs are playing a crucial role in accelerating EV adoption and making sustainable mobility more financially viable.
Q: How can green financing tools for EVs contribute to India’s renewable energy goals, and what challenges exist in scaling them?
Sumeru Shah: Green financing is a critical enabler of India’s transition to a sustainable mobility ecosystem. By making EVs more affordable, financial tools such as structured loans, BaaS, and leasing are driving mass adoption—directly reducing reliance on fossil fuels and supporting the country’s renewable energy objectives. However, scalability remains a challenge, primarily due to consumer hesitancy and the slow deployment of charging infrastructure. Without a robust charging network, large-scale EV adoption remains constrained. Bridging this gap requires coordinated efforts across policymakers, financial institutions, and industry players to ensure that infrastructure development keeps pace with growing demand.
Q: How has increased EV adoption impacted emissions, job creation, and the overall economy?
Sumeru Shah: The rise of EV adoption has already begun reshaping India’s economic and environmental landscape. On the environmental front, reduced sales of internal combustion engine (ICE) vehicles have directly cut fossil fuel consumption, leading to lower emissions and improved air quality. Economically, the growth of the EV sector has created new employment opportunities across manufacturing, services, and infrastructure development. Additionally, reduced dependency on imported fuel translates into significant foreign exchange savings for the country. These dual benefits, both environmental and economic, underscore the transformative potential of EV adoption in driving sustainable growth.
Q: What are the emerging trends in sustainable mobility and climate finance, and how is Ecofy helping bridge the funding gap in India?
Sumeru Shah: The future of sustainable mobility is being shaped by innovative financing solutions and an evolving regulatory landscape that prioritizes green investments. As an industry leader, Ecofy is at the forefront of bridging the funding gap through cutting-edge financial products tailored to the EV sector. Our BaaS and leasing models are designed to remove financial barriers, enabling faster and broader EV adoption. By providing structured financing that aligns with evolving consumer and business needs, Ecofy is not just facilitating the transition to electric mobility but actively driving India’s larger sustainability agenda.