Amid climate change, Covid-induced economical downturn and rising fuel prices, Indian government is aiming to make electric vehicle business in India more lucrative and easy-to-set-up. For the same, the government is planning to set up institution to fund Electric Vehicles (EV) businesses.

Union Minister Nitin Gadkari (Minister for Road Transport & Highways) has announced that the government is planning to set up an institution to fund businesses with a focus on electric vehicles. The government also aims to help provide loans to the public transport and commercial vehicle segment and for this the government will facilitate new financial instruments for lending.

The minister, while addressing the India Global Forum 2021 on Thursday, said the government is also planning to encourage construction equipment vehicles to go electric and promises to incentivize them.

Last month, the central government increased the subsidy on electric two-wheelers after which the incentive amount on purchase of electric two-wheeler has been increased to Rs 15,000 per kWh, which is Rs 5,000 per kWh more than the earlier subsidy-rate.

In order to bring down the cost of electric vehicles and make it more affordable for the masses the government is making efforts that include supporting domestic electric vehicle manufacturers and startups.

Besides, India's research institutions are also working on an alternative battery technology for electric vehicles, told the minister. Notably, the battery cost is 50% of the total cost of an electric vehicle.

As per a recent report, India's electric vehicle financing industry is projected to be worth Rs 3.7 lakh crore in 2030.

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