48% GST on hybrid cars, 5% on EVs necessary for maintaining push towards green mobility: Amitabh Kant

India has a policy framework where the tax on electric vehicles (EVs) is 5% as compared to 48% on hybrids and we intend to continue this over a long period of time to maintain the push towards green mobility, G20 Sherpa Amitabh Kant said on Sep 3.

Large duty differential between electric and hybrid cars should be maintained as the country should incentivize zero-emission technologies to reduce greenhouse gas emissions and stabilize climate change, according to Kant.

Kant’s remarks are not a good news for companies like Maruti Suzuki, Toyota, and Honda for obvious reasons.

Speaking at an event organized by Mercedes-Benz Research and Development India (MBRDI) here, Kant said govt will relentlessly push for adoption of clean mobility in the country through various policy measures.

"We've had a policy framework where the tax on electric vehicles is 5% as compared to 48% on hybrids, which we intend to continue over a long period of time," he said.

Arguing that hybrids are relatively clean against pure-petrol vehicles and thus should be incentivized, Japanese companies have been trying hard to get GST rates down on hybrids from 48%.

However, this suggestion is being opposed by other companies like Tata Motors and Mahindra & Mahindra, which argue that only zero-emission technologies should be incentivized and there should be no concessions for intermediate measures.

Kant said the govt is pushing for battery manufacturing in a very big way. "As per our policy we push for more and more electrification in mobility through all the policy levers available, including CAFE norms. So we will relentlessly push for India becoming a green mobility destination." he said.

“If the country doesn't make the shift to cleaner technologies, it would miss out on the opportunity to become a leader in EV manufacturing,” he added.

Following the tender for at least 6,000 electric buses for seven cities, bigger tenders would roll out in the future.

"The next tender we are doing is for 10,000 buses and the third tender would be for 50,000 buses. Therefore, the size and scale would help in bringing down the prices of electric buses in a big way." Kant said.