Rajasthan latest Indian state to announce EV buyer incentives

by Ajit Dalvi 17 Jul 2021


Rajasthan has become the latest state in India to announce incentives for buyers of electric vehicles, particularly two- and three-wheelers, albeit with a different incentives compared to other states.  

On July 16, 2021, the state government’s Transport Department issued a notification, which is designed to encourage the purchase of electric vehicles in the state. As per the notification, a provision is made to reimburse the SGST (State Goods and Service Tax) amount and give one-time grant to EV buyers. Recharge of the SGST amount is payable on all types of EVs.

A lump sum grant amount will be payable on all electric two- and three-wheelers, as per their battery capacity (see detailed table below). This grant amount is payable on vehicles purchased from April 1, 2021 to March 31, 2022 and registered till March 2022. Importantly, the document states that the vehicle must be purchased from the state of Rajasthan itself. Financial transfer is to be done at the level of the concerned District Transport Officer. The amount of SGST, to be recharged by the seller of the vehicle, will be equal to the amount shown in the bill, says the notification.

Indian states race to fast-track EV adoption
With growing consumer awareness about EVs, the recently enhanced FAME subsidy for two-wheelers, termed the ‘low-hanging fruit’ of the EV industry and also sky-high wallet-busting petrol prices, the EV industry is seeing considerable traction. This can be seen in terms of new investment towards setting up manufacturing plants, EV infrastructure as well as vehicle buying, particularly two- and three-wheelers.

What’s more, over the past year, a number of states across India have come up with their own EV policies all designed to incentivise buying as well as to make manufacture of these eco-friendly vehicles a smooth experience.

On July 13, Maharashtra unveiled a comprehensive all-encompassing policy. In August 2020, Delhi notified its EV Policy, which aims to register 500,000 electric vehicles in the city by 2024. In June 2021, Gujarat rolled out its own policy, which targets a total of 200,000 EVs which includes 110,000 e-two-wheelers; 70,000 e-three-wheelers and 20,000 e-four-wheelers.

In September 2019, traditional automotive hub Tamil Nadu had drafted a policy to be India’s ‘EV hub, aiming to attract Rs 50,000 crore investment