The Union Budget 2026-27 has delivered a decisive roadmap for India’s transition to clean mobility and sustainable energy. With targeted incentives, higher allocations, and policy support, the government has reinforced its commitment to electric vehicles (EVs), renewable energy, and domestic manufacturing.
Here are the most important announcements shaping the sector:
Major Boost to Clean Public Transport
- Development of the East Coast Industrial Corridor with 4,000 new e-buses
- Target to install 72,000 public EV charging stations nationwide
- Focus on large-scale electrification of urban and intercity mobility
These steps will accelerate EV adoption and strengthen charging infrastructure across India.
Strengthening Domestic EV Manufacturing
- Dedicated facilitation groups to identify key supply chains
- Support for localization of EV components and battery manufacturing
The move is expected to reduce import dependence and create a stronger domestic ecosystem for EV production.
Support for Critical Minerals & Batteries
- Customs duty exemptions on capital goods for processing critical minerals
- Extension of duty benefits for lithium cell manufacturing equipment
- Creation of Rare Earth Corridors in Odisha, Kerala, Andhra Pradesh, and Tamil Nadu
- ₹7,280 crore scheme to build 6,000 MT/year rare earth magnet capacity
These measures directly support battery production and long-term energy storage growth.
Higher Allocation for EV Adoption
- ₹1,500 crore allocated for the PM E-Drive Scheme in FY27
- Scheme tenure extended till March 2028
- Over 21 lakh EVs already incentivized
This ensures continued consumer and industry momentum in EV adoption.
Encouraging Renewable Fuels
- Biogas-blended CNG fully excluded from excise duty calculations
- Improved viability for bio-CNG and alternative fuel projects
Digital Transformation for Sustainability
- ₹500 crore allocation for AI in Education
- Launch of Bharat Vistar AI platform for agriculture and sustainability
Big Boost to Auto PLI Scheme
- Allocation doubled to ₹5,940 crore
- Incentives up to 18% for EV and hydrogen fuel-cell technologies
A Budget Built for a Greener India
The 2026-27 Budget clearly prioritizes clean mobility, energy security, and self-reliance. With stronger infrastructure, manufacturing incentives, and long-term policy support, India’s EV and cleantech ecosystem is set for accelerated growth in the years ahead.
