In a bid to combat rising air pollution, the Delhi government is planning to reintroduce subsidies for electric vehicles (EVs). The new Electric Vehicle Policy, expected to roll out in the next financial year, places a strong emphasis on financial incentives to bridge the price gap between traditional petrol/diesel vehicles and their electric counterparts.
Chief Minister Rekha Gupta has stated that the primary focus of the forthcoming policy will be on providing financial incentives. The goal is to make EVs affordable for every middle-class family in Delhi and ensure that charging them is as easy as charging a mobile phone. The government is exploring various support mechanisms, including purchase subsidies and scrappage benefits for those who trade in their old petrol or diesel vehicles for electric alternatives. A scrapping incentive scheme is being introduced to remove highly polluting vehicles from the roads, with additional financial benefits for those scrapping older vehicles and purchasing a new EV.
While the final incentive structure is still being worked out, the draft policy proposes a subsidy of ₹35,000 to ₹40,000 for individuals switching from petrol-powered two-wheelers to electric ones. Subsidies for electric cars, previously capped at ₹1.5 lakh for the first 1,000 vehicles, were later withdrawn under the previous policy. The new policy may also offer subsidies for petrol and diesel vehicles priced up to Rs 20 lakh if they are converted to electric. The EV purchase incentives are expected to cover both two- and four-wheelers. These initiatives will supplement existing incentives offered by the Union heavy industries ministry for electric buses, trucks, and two- and three-wheelers.
Another key aspect of the new EV policy is the expansion of EV charging infrastructure throughout Delhi, including residential areas. This includes plans for neighborhood charging stations, streamlined approvals for charging installations, and provisions for battery-swapping facilities to reduce range anxiety among EV users.
Delhi's first EV Policy was notified in 2020 and expired in August 2023. It has since been extended periodically while the new framework is being finalized. Under the earlier policy, electric two-wheelers were eligible for a subsidy of ₹5,000 per kWh, capped at ₹30,000, while electric three-wheelers received a flat incentive of ₹30,000. EVs were also exempt from road tax and registration fees.
The draft EV policy is likely to be released by the first week of January, with implementation expected from the beginning of the new year, as the current policy expires on December 31. Before final implementation, the draft framework will undergo consultations with key stakeholders, including power distribution companies, auto manufacturers, scrap dealers, and the public, to refine incentives. The new policy is designed to support private EV buyers and incentivize commercial fleets and public transport operators to transition to electric vehicles, reducing emissions across Delhi's congested roads and improving overall air quality. The government aims to significantly reduce particulate matter levels (PM2.5 and PM10) by encouraging the phasing out of older, high-polluting vehicles and making EVs more affordable and accessible. The upcoming policy seeks to position Delhi "as the country's leading EV hub".
