Mobilising Electric Vehicle Financing in India

 

 

Context :

Govt plans institution to fund businesses focused on electric vehicles: Gadkari  /  ET / 02 July

Extract :

Ø  The government is planning to set up an institution to fund businesses with a focus on electric vehicles as well as facilitate new financial instruments for lending to the public transportation and commercial vehicle segment, Union minister Nitin Gadkari said on Thursday.

Ø  According to a recent report, India's electric vehicle financing industry is projected to be worth Rs 3.7 lakh crore in 2030, which would be about 80 per cent of the current retail vehicle finance industry.

Ø  The report titled 'Mobilising Electric Vehicle Financing in India', prepared by Niti Aayog and Rocky Mountain Institute (RMI) had also said that end-users currently face several challenges such as high interest rates, high insurance rates, and low loan-to-value ratios.

Ø  "The government is planning to set up a financial institution to fund business with a focus on electric vehicles and facilitate new financial instruments for lending to the public transportation and commercial vehicle segment," he said.

 

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Dear Shri Gadkariji,

 

 

You are a “ Man of Vision “  and an “  Out-of-Box “ thinker

 

If a person plans on “ Inter-galactic Travel “, he must discard the framework of a “ Space-Ship “ ( which is OK for crossing a few thousand miles of an ocean )

 

For “ Inter-galactic  Travel “ ( aka your “ 30 %  Electric Vehicle by 2030 “ plan ), you need to travel at WARP speed through a WORM-HOLE !

 

 

NOTHING LESS WILL WORK !

 

Following is my 5 YEAR old e-mail detailing such a WORM-HOLE  :

Ø   PIYUSH PLAN ? ……………………………………………..[ 27 Mar 2016 ]

 

#   time  frame  for  change-over

#   disposal  of  existing  vehicles ( 200 million + produced till 2030 )

#   charging  stations

#   incentive  for  car  manufacturers  and  car  owners

#   general / global  incentives

 

And ,

#   FINANCING

       Shri Goyal said :

       We don't need one rupee support from the government

        We don't need one rupee investment from the people of India

 

        But Vehicle Manufacturers say :

       We cannot give away electric cars for FREE !

 

   We need money to run our operations and in advance . At the most , we can

   consider some sort of "

   Hire Purchase " scheme ,

    if we can get funds at an interest rate of 5 % and are allowed to charge

     the buyers , 10 %

 

        And Banks say :

        We have already advanced car-loans totalling thousands of crores . If we are

            allowed to transfer the unpaid balances along with the fresh loan amounts ,

            to a " Restructured Loan " bearing a higher interest rate ( and EMI ), then

            we can consider "

 

        Government says :

       We don't have funds to build more roads . So, where is the question of

       financing private purchase / usage of cars ? We would rather build more /

       better ( concrete ) roads "

 

       Individual says :

       I can hardly make ends meet ! If I must borrow from anyone, I would rather

       buy a roof over my head. I am already paying huge EMIs for my current car 

 

 

      I say :

 

     *  No questions asked for any CASH deposited into a person's Jan Dhan Bank

         account

  

     *  Create a SPV called , EVFF ( Electric Vehicle Finance Fund )

 

     *  Public can invest in this fund but only from their Jan Dhan Bank Accounts

        deposits

 

     *  Interest earned from EVFF to be totally free from personal Income Tax for

        10 years

 

     *  EVFF will finance Car Loan companies or " Hire Purchase Schemes " of car

         manufacturers

 

     *  Car finance companies will be asked to stop financing of petrol / diesel cars

         and finance   only electric vehicles

  

 

     If this is implemented , within 6 months , EVFF will be able to create a Corpus

     of Rs 10 lakh*crores !

 

     Can you think of a better way of harnessing  BLACK  money to finance a

     GREEN  future ?

 

With Regards,

Hemen Parekh  /  hcp@RecruitGuru.com  /  02 July 2021