Madhya Pradesh’s EV Policy 2025: Boosting Manufacturing and Adoption through Capital Subsidies and Incentives

Madhya Pradesh’s Electric Vehicle (EV) Policy 2025: Capital Subsidies and Support for Manufacturing Growth

Madhya Pradesh has introduced its comprehensive Electric Vehicle (EV) Policy 2025, a strategic five-year initiative aimed at accelerating the adoption of EVs and positioning the state as a leading manufacturing hub for EVs in India. This announcement comes just ahead of the Global Investors Summit (GIS) 2025, scheduled for February 24-25 in Bhopal.

The policy specifically targets Battery Electric Vehicles (BEVs) and Fuel Cell Electric Vehicles (FCEVs), deliberately excluding hybrid models. It presents a solid framework of incentives, infrastructure development, and skill-building initiatives to support these goals.

The incentives outlined in the policy are extensive. For electric cycles, a subsidy of INR 5,000 is available for the first 30,000 units. Two-wheelers can receive a subsidy of either INR 10,000 or INR 5,000 per kWh, along with complete tax and registration fee exemptions. Three-wheelers and cars will also benefit from various subsidies, interest subventions, and incentives for vehicle scrapping.

A significant aspect of the policy is the requirement for mandatory EV parking spaces, which will constitute 20% in new residential societies and 25% in public, commercial, and government areas. Light commercial vehicles will also enjoy subsidies and tax breaks, while a target has been set for a 40% adoption rate of electric buses within public transport corporations.

The policy extends subsidies and tax exemptions to e-buses, with prioritized timings for inter-city services, as well as support for charging infrastructure along inter-city routes. In response to heavy-duty vehicle emissions, Madhya Pradesh will pilot electric trucks (with a Gross Vehicle Weight Rating of 5-55 tonnes) and tractors, offering a 20% upfront subsidy and requiring data sharing. Furthermore, zero-emission trucks and tractors will be exempt from road tax and registration charges.

Incentives for retrofitting existing vehicles with electric powertrains are also included, particularly for electric two-wheelers, three-wheelers, and four-wheelers. Additional benefits encompass a 50% toll tax exemption for the first year, shared incentives between vehicle and battery owners, and perks for state government employees. The policy also plans for green number plates and the establishment of ‘Green Zones/E-mobility Zones.’

To enhance the charging infrastructure, the establishment of Public Charging Stations (PCS) will be de-licensed, accompanied by financial incentives for various types of PCS. The ‘EV Tarang’ portal will facilitate the deployment of PCS. The policy mandates that new buildings be EV-ready, encourages private charging points with property tax rebates, and offers favorable electricity tariffs. Additionally, the integration of renewable energy and vehicle-to-grid (V2G) technology is prioritized, with petrol stations required to have at least one EV charging point.

Madhya Pradesh aims to attract EV and component manufacturers through a streamlined single-window clearance process, capital subsidies that vary based on industry size, employment generation incentives, interest subventions, and reimbursements for stamp duty and state GST. A manufacturing land bank will be established, along with quality certification and intellectual property incentives.

The policy underscores the importance of battery reuse and recycling, providing guidelines and incentives to support these efforts. Research and innovation will be fostered through Centres of Excellence, incubation centers, and testing laboratories. Additionally, EV-related courses will be integrated into ITIs and engineering colleges, with free EV repair training provided for professionals. Vocational courses will be developed in collaboration with industry partners, and stipends will be offered to participants. Public awareness campaigns will also be organized, with OEMs required to submit consumer awareness strategies.

The Urban Development and Housing Department (UDHD) will serve as the nodal department, while the Madhya Pradesh Electric Vehicle Policy Board (MP-EVPB) will coordinate the implementation of this policy, which is set to remain in effect for five years.

The overarching goal of this policy is to create a sustainable EV ecosystem that drives economic growth and contributes to cleaner air in Madhya Pradesh. Its success will hinge on effective implementation and the resolution of infrastructure and adoption challenges.