India Electric Vehicle Market

• Increasing Fuel Prices to Accelerate Market Growth

The rising cost of fossil fuels in India is one of the main reasons why electric car demand is expected to soar in the region. ones powered by fossil fuels are less expensive to buy than electric ones. However, because of the rising cost of fuel and gasoline, their running costs are considerable. On the other hand, compared to vehicles fueled by fossil fuels, electric vehicles have far lower running costs.

The India Electric Vehicle market is therefore expected to grow more rapidly during the projected period as a result of consumers' choice moving toward adopting electric vehicles in response to rising fossil fuel prices. In addition, it is projected that government efforts to combat climate change, such as the introduction of laws for the scrapping of conventional vehicles and the tightening of emission control standards, will propel market expansion in the years to come.

The growth in EV manufacturing and sales is mostly due to government programs and subsidies. To encourage the use of hybrid and electric vehicles (EVs) in the nation, the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) in India program was introduced in April 2015. Following that, in April 2019, the FAME-II scheme—which would have supported 55,000 e-passenger vehicles and charging stations—was introduced with a budget cost of $1.3 billion (INR 10,000 crore). The Union Budget 2022–2023 indicated the government's extension of the program until 2024.

The program is mostly applicable to cars registered for commercial use or utilized for public transportation, with a strong focus on providing accessible and environmentally friendly public transit to the general public. With the necessary infrastructure in place, this will help the EV business even more and drastically lower the price of electric vehicles. Thus, driving the India electric vehicle market revenue.

The Global India Electric Vehicle Market Industry is projected to experience remarkable growth in the coming years. With a market value anticipated to reach 7.5 USD Billion in 2024 and further escalate to 35 USD Billion by 2035, the industry is on a promising trajectory. This growth is underpinned by a compound annual growth rate (CAGR) of 15.03% from 2025 to 2035, indicating a robust expansion phase. Such projections reflect the increasing adoption of electric vehicles, driven by various factors including government initiatives, technological advancements, and changing consumer preferences.

Increasing awareness regarding environmental degradation and climate change has propelled the Global India Electric Vehicle Market Industry forward. As urban pollution levels rise, consumers are becoming more conscious of their carbon footprints. Electric vehicles, which produce zero tailpipe emissions, are seen as a viable solution to mitigate air pollution. This shift in consumer sentiment is likely to contribute to the market's expansion, with projections suggesting a market value of 35 USD Billion by 2035. The growing emphasis on sustainable transportation solutions aligns with global trends towards cleaner energy and reduced greenhouse gas emissions.

The Global India Electric Vehicle Market Industry benefits significantly from various government incentives and policies aimed at promoting electric vehicle adoption. The Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme, for instance, provides substantial subsidies for electric vehicle purchases, thereby reducing the financial burden on consumers. This initiative is expected to drive the market value to approximately 7.5 USD Billion in 2024. Furthermore, the government's commitment to achieving 30 percent electric vehicle penetration by 2030 indicates a robust policy framework that supports the industry's growth and sustainability.

The expansion of charging infrastructure is crucial for the success of the Global India Electric Vehicle Market Industry. The government and private sector are investing heavily in the development of charging networks across urban and rural areas. This infrastructure development addresses one of the primary concerns of potential electric vehicle buyers: range anxiety. With more charging stations becoming available, consumers are likely to feel more confident in adopting electric vehicles. This trend is expected to facilitate the market's growth, contributing to the anticipated market value of 7.5 USD Billion in 2024 and beyond.

Advancements in battery technology play a pivotal role in shaping the Global India Electric Vehicle Market Industry. Innovations such as lithium-ion batteries have significantly improved energy density, charging speed, and overall vehicle performance. These technological improvements not only enhance the driving range of electric vehicles but also reduce costs, making them more accessible to consumers. As battery prices continue to decline, the market is poised for substantial growth, with a projected CAGR of 15.03% from 2025 to 2035. This trend indicates a promising future for electric vehicles as they become increasingly competitive with traditional combustion engine vehicles.

There is a growing consumer demand for sustainable mobility solutions, which is significantly influencing the Global India Electric Vehicle Market Industry. As consumers become more environmentally conscious, they are increasingly seeking alternatives to traditional vehicles. Electric vehicles are perceived as a cleaner, more sustainable option, leading to a shift in purchasing preferences. This trend is expected to drive the market's growth trajectory, with projections indicating a market value of 35 USD Billion by 2035. The alignment of consumer preferences with sustainability goals suggests a robust future for electric vehicles in India.

The India electric vehicle market area will grow at a significant rate. India's electric vehicle market saw rapid growth in 2021 thanks to the government's adoption of beneficial laws and initiatives. In India in 2021, Uttar Pradesh had the largest percentage of EV sales. 66,704 units were sold overall across all categories, with Tamil Nadu and Karnataka coming in first and second, respectively, with 33,302 and 30,036 units. Karnataka and Maharashtra lead the two- and four-wheeler segments, respectively, while Uttar Pradesh dominated the three-wheeler category.

Mahindra & Mahindra, for example, intends to introduce 16 BEV by 2027, eight of which will be in the SUV and light commercial vehicle segments.

Leading market players are investing heavily in research and development in order to expand their product lines, which will help the electric vehicle market, grow even more. India Electric Vehicle Market participants are also undertaking a variety of strategic activities to expand their  footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, the electric vehicle industry must offer cost-effective items.