India Launches EV Scheme Portal: Import Tax Cuts in Exchange for Local Investment

India’s bold push toward becoming a global electric vehicle (EV) manufacturing hub has entered a key phase. On June 25, the Union Ministry of Heavy Industries officially launched the application portal for the Scheme to Promote Manufacturing of Electric Passenger Cars in India, offering global automakers a chance to tap into the Indian market at significantly reduced import duties provided they commit to local production.

SPMEPCI Portal Open Until October 21

The Ministry of Heavy Industries (MHI) announced the portal launch of the application process under the Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI). The scheme, first notified on March 15, 2024, is aimed at attracting large-scale foreign investments into India’s EV sector, in exchange for tax incentives and a structured rollout plan. The portal will remain open until October 21, 2025.

SPMEPCI Key Benefits and Commitments

Under the scheme, automakers can import up to 8,000 electric vehicles per year at a reduced customs duty of 15%, down from the current 70–100%, if they commit at least ₹4,150 crore (~$500 million) toward local EV manufacturing.

To qualify, companies must:

• Start operations within 3 years of receiving approval.
• Achieve 25% domestic value addition (DVA) in their cars within three years.
• Increase DVA to 50% within 5 years.
• Capitalise all eligible investments after receiving approval, with equipment and machinery only being deployed post-approval.

The total duty benefit per applicant is capped at ₹6,484 crore.

Tesla and Mercedes-Benz: Mixed Signals

As per the Economic Times report, Tesla has shown interest in entering India—but only to open showrooms and sell vehicles.

As for Mercedes-Benz, the German luxury brand has already made significant investments in India, prior to the scheme's formal opening.

Early Interest, But Formal Applications Awaited

As per the news report, 4 to 5 global automakers have expressed preliminary interest. However, formal applications will only be accepted via the portal starting this week. The ministry retains the right to reopen the portal until March 15, 2026, should further interest arise or fresh incentives be considered.

Outreach to Global OEMs Underway

To drive participation, the government is actively reaching out to countries with major automobile manufacturers including the US, Germany, UK, and Czechoslovakia via embassies and trade channels.

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Conclusion

This new EV policy could mark a turning point in India's automotive landscape. By lowering import taxes and requiring phased domestic investment, the scheme aims to balance foreign participation with local job creation and value addition. While interest appears strong, all eyes are now on which automakers will formally commit to "Make in India" for electric cars.

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