India Considers Easing Localization Rules for EV Makers Amid Supply Chain Disruptions

India is open to relaxing its localization requirements for electric vehicle (EV) manufacturers and suppliers in exchange for incentives, following disruptions in rare earth supplies from China. The move comes as automakers struggle to meet the 50% localization target under the government’s Production-Linked Incentive (PLI) scheme.

 

Key Highlights:

The PLI scheme, designed to boost local manufacturing, has faced challenges due to global supply chain dependencies. Rare earth minerals are crucial for traction motors used in EVs, and China’s export curbs have forced Indian manufacturers to reconsider their sourcing strategies.

 

While the government has advised automakers to import fully-built motors or assemblies as a short-term solution, industry leaders are pushing for a long-term policy shift to ensure stability in EV production.

 

Source: Moneycontrol, E-Vehicle Info, PWOnlyIAS