15% Tariff + 8,000-Vehicle Quota! Now Is the Time for Abrasive Enterprises to Enter the Indian Market

15% Tariff + 8,000-Vehicle Quota! Now Is the Time for Abrasive Enterprises to Enter the Indian Market

Recently, India introduced a new electric vehicle (EV) policy allowing eligible companies to import EVs priced at or below $35,000 with a reduced tariff of 15%, capped at 8,000 units per year. In return, automakers must commit to investing $486 million in local manufacturing and achieve 25% localization within 3 years and 50% within 5 years. The policy will remain in effect for five years.

This new policy provides a significant opportunity for global automakers to enter the high-potential Indian market. By lowering import duties, India aims to attract international players to invest in domestic production and to drive the development of the local EV supply chain. The policy lowers short-term market entry barriers while supporting long-term industry growth.

Why is the Indian market worth watching?

Policy Support: The Indian government targets EVs to make up 30% of new vehicle sales by 2030 and has introduced a range of subsidies and tax incentives to drive industry growth.

Consumer Demand: India is the world’s fourth-largest auto market. With a growing middle class and increasing environmental awareness, demand for EVs continues to rise.

Supply Chain Opportunities: The requirement for localized production will stimulate the development of supporting industries such as batteries, motors, and components, creating major opportunities for related businesses.

Riding the Policy Wave: Seize the Moment in India
For companies aiming to tap into India’s EV market, establishing a presence in the upstream supply chain is just as critical as vehicle manufacturing. For example, precision grinding technology plays a vital role in battery production, motor components, and vehicle body processing. Given India’s currently underdeveloped domestic supply chain, this creates space for international enterprises to export advanced technologies and form strategic partnerships.

The rapid rise of India's EV market is set to drive the entire high-end manufacturing chain forward. Whether you are an automaker or a supporting supplier, now is the ideal time to establish your foothold!