The Uttar Pradesh Cabinet today approved a new electric vehicle policy with the intention to attract electric vehicles-related projects in the State and also to promote user adoption.

As per the draft of the UP Electric Vehicle Policy 2022, a 15 percent rebate will be given on the purchase of two or four-wheeler electric vehicles, e-buses, and a 100 percentage discount on registration and road tax in the state.

Electric vehicle registration and road tax will be exempt for the first three years following the implementation of the EV policy. There will be a 50 percent relaxation in the fourth and fifth years.

According to the report, a 15 percent (maximum Rs 5,000) discount on the factory price of a two-wheeler electric vehicle will be given for one year from the date the EV policy is issued. Furthermore, government employees will be encouraged to purchase EVs, with advance funding provided by the state government.

Also, the new policy provides a 3 percent capital subsidy on investments up to Rs 1,000 crore per project for the state's first two Ultra Mega battery projects that invest Rs 1,500 crore or more each in setting up battery manufacturing plants with a minimum production capacity of 1 GwH.

Furthermore, the policy will reimburse manufacturers for stamp duty at a rate of 100 percent to the Integrated EV Project and Ultra Mega Battery Project for establishing a facility anywhere in the state.

With this announcement, UP joins several states including Delhi, Maharashtra, Telangana, Karnataka, Gujarat, Andhra Pradesh and others that have announced EV policies. In recent months, Gujarat has gone all out to attract EV investment with Suzuki Motor Company announcing its intention to invest Rs 10,444 crore in the state for the making of electric vehicles and batteries.

Every major investment by an OEM brings in funds into the ecosystem, and in the years to come, the state could see companies setting up base here to make batteries, charging infrastructure as well components for the EV sector as whole.

It is something that UP will also be hoping for as the state government rolls out the red carpet for potential investors. It may be mentioned that the state ranks among the leading ones in terms of numbers of EV registrations (over 2.5 lakh), pushed to go electric by high prices for traditional fuels.