March 4th,2025
India’s EV Revolution Gets a Local Push: New Manufacturing Mandates Shake Up Industry
In a bold move to accelerate domestic EV manufacturing, the Ministry of Heavy Industries has amended the PM E-DRIVE Scheme, mandating stringent local production requirements for electric vehicles. Effective May 1, 2025, the revised Phased Manufacturing Programme (PMP) targets self-reliance in critical components like batteries, motors, and chargers—a game-changer for automakers navigating India’s booming EV market.
The Core Changes
- Battery Boom: Traction battery packs must now be fully manufactured domestically, including cell connections, thermal systems, and enclosures. Importing pre-assembled modules is no longer allowed.
- Tech Surge: Components such as Vehicle Control Units (VCUs), DC-DC converters, and motor controllers now require in-house assembly of semiconductors, wiring, and firmware integration.
- Deadlines Loom: For e-buses, HVAC systems, electric compressors, and CCS2 charging inlets, a six-month deadline has been set for local production. Additionally, BMS imports will be phased out by 2026.
Why This Matters
The policy closes loopholes that previously permitted the import of semi-knocked-down (SKD) kits. With Tesla’s India entry on the horizon and domestic players like Tata Motors scaling up production, this mandate is designed to reduce reliance on foreign suppliers while strengthening India’s component ecosystem.
Industry Reactions
While many OEMs welcome the push for localization, there are concerns about the aggressive timelines. “Meeting BMS and semiconductor assembly targets by 2026 requires massive skill development,” commented an anonymous auto executive.
The Bigger Picture
This initiative aligns with India’s 2030 EV adoption goals under the FAME-II and PLI schemes. Analysts expect a significant increase in domestic R&D investments, particularly in battery technology, as companies work to avoid penalties for non-compliance.
