PM asks auto industry to adopt electric technology fast

Prime Minister Manmohan Singh today asked vehicle manufacturers to adopt electric technologies fast in order to reduce dependence on imported oil and supplement efforts for a greener transport system.

"It is important that we make efforts for reducing the transport sector's dependence on oil. One of the ways in which this can be achieved is by faster adoption of the full range of electric vehicle technologies, including hybrid vehicles," he said after unveiling the National Electric Mobility Mission Plan 2020.

The mission involves a total investment of over Rs 23,000 crore which would be equally shared by the government and the auto industry.

The Prime Minister said India's transport sector consumes a large amount of energy. Over 80 per cent of the country's requirement of petroleum products is met through imports.

"This dependence on imports is likely to increase further. High international prices of oil contribute significantly to India's import bill, to our trade deficit and, I dare say in a world of rising petroleum prices, to inflation, thus putting a big strain on our economy," the Prime Minister said.

As per the ambitious National Electric Mobility Mission Plan, 6-7 million electric vehicles along with resultant liquid fuel savings of 2.2-2.5 million tonnes can be achieved in 2020.

"This (mission) is an important milestone in our country's efforts for a cleaner and greener transport system for the future," he said.

Besides, he asked the automotive industry to make all possible efforts to develop capabilities in the area of electric mobility.

At present, the production of electric and hybrid vehicles is negligible in the country.

Stating that significant barriers exist for faster adoption of the new electric mobility technologies by consumers, the Prime Minister said, "It is, therefore, necessary to create an eco-system where these technologies can be nurtured. The government is committed to work with industry and other stakeholders to make it happen."

The plan is expected to be implemented from April 2013 in a phased manner. The Department of Heavy Industry (DHI) would approach the Finance Ministry soon to gets its nod for funding the mission.

He further said while promoting private transport through electric vehicles is a positive step, one must give far greater focus to the development of public transport using energy efficient and alternative energy technologies.

"I would urge that this should be kept in mind when each aspect of the plan is being assessed and implemented. Given our population size and urban densities, public transport should be given greater priority than private transport. In our country, the primary mode of daily commuting should be a high quality energy efficient public transport system," he added.

He also said the International Energy Agency projects that 75 per cent of the projected future increases in oil demand will be from the transport sector.

"India and China are likely to account for a major part of this increased global demand for oil," he said.

India's oil import bill leaped 40 per cent to a record $140 billion in 2011-12. Also, net oil importing countries like India experience a deterioration in their balance of payments, putting downward pressure on exchange rates.

Talking about the Automotive Mission Plan (AMP) 2006-16, the Prime Minister said,"...I am happy that we are well on track to achieve the various important milestones that we had together set for ourselves in the Mission Plan."

"This gives me the confidence to believe that the automotive industry, which has been at the forefront of Indian manufacturing, will be able to fully realise the potential that exists in our country for the new technologies," he added.

The AMP 2006-16 had envisaged India to become a global hub for designing and manufacturing of automobiles and auto components with output reaching $145 billion and accounting for more than 10 per cent of the country's GDP. It had also set a target of providing additional employment to 25 million people during the period.

The Indian automobile industry has grown over the years since the announcement of the AMP in 2006, when the overall production of vehicles rose from 9.7 million units to 20 million in 2011-12.