Only 13% of “Made-in-India” EVs Qualify for PLI Scheme as China Imports Dominate
Only about 13% of electric vehicle (EV) models made in India currently qualify for the government’s PLI (Production-Linked Incentive) scheme, exposing a deep reliance on imported parts, especially from China. The Economic Times
According to reports, just 6 out of 46 EV models sold in India meet the domestic value-addition (DVA) requirements set by the Ministry of Heavy Industries. To be eligible for PLI, manufacturers must have at least 50% local content, a threshold lowered to 40% when excluding battery cells.
The auto industry’s dependence on Chinese (and Taiwanese) imports remains stark: many EV makers rely on key components like lithium-ion battery cells, rare-earth magnets, semiconductors, DC motors, stators, and other electronic parts from abroad.
As of now, the only PLI-approved EV models include five from Tata Motors (such as the Punch, Nexon, Harrier, Tiago, and Tigor) and one from Mahindra (XEV9E). Notably, other EV models, even from major brands, failed to meet the required localization benchmarks.
Industry insiders say that building a robust domestic EV supply chain is still challenging: local capacities for advanced components remain underdeveloped, and scaling up manufacturing for parts like high-performance cells and power electronics demands big investments.
Editor’s View
This is a red flag for India’s EV ambitions. The fact that only about 13% of “made-in-India” EVs are eligible for PLI benefits highlights the fragility of the local EV ecosystem. If most models rely heavily on Chinese components, it defeats the purpose of the PLI scheme, which is supposed to drive local value addition and reduce import dependence.
For the country to truly scale EV manufacturing, it’s not enough to assemble cars here. India needs to develop its own battery-cell manufacturing plants, semiconductor fabrication facilities, and magnet production capacities. Until then, the PLI scheme risks incentivizing only a very narrow slice of the market, making the goal of EV self-reliance much harder.
