Electric vehicles to be prioritised in central government ministries

The Union Finance Ministry has directed all ministries and departments to make electric vehicles (EV) the 'default and preferred choice' for the procurement of government staff cars from now on. According to reports by 'The Hindu' and 'Business Standard', the main objective of this decision is to promote electric mobility, reduce dependence on fossil fuels, and accelerate eco-friendly transport. Under this new policy, government departments have now set a Net Dealer Price (NDP) limit of ₹20 lakh for the purchase of electric vehicles.

An Office Memorandum issued by the Expenditure Department of the Finance Ministry on 10 November clarifies that whenever the need arises to replace existing petrol, diesel, or hybrid (ICE) vehicles or to purchase new vehicles, priority must be given to electric vehicles. In previous instructions issued in 2022, the NDP limit for staff cars was set at ₹6 lakh, which has now been significantly revised. As per the new rule, a limit of ₹10 lakh has been set for ICE vehicles, which is half of the ₹20 lakh limit prescribed for electric vehicles.

If any ministry or department feels that the purchase or use of an electric vehicle is not practical and they wish to purchase an ICE vehicle, they will have to send a proposal with valid reasons to the Expenditure Department. In such cases, it will be mandatory to obtain the approval of the Secretary of the administrative ministry and the concurrence of the Financial Adviser. This process will be examined on a case-by-case basis. Furthermore, all departments must continue to comply with the 2022 instructions for leased vehicles, which emphasised leasing electric vehicles. If it is deemed necessary to take an ICE vehicle on lease, approval from the Expenditure Department must also be obtained for that.

The government's approach includes measures such as financial incentives, promoting local electric vehicle manufacturing, developing charging infrastructure, and encouraging the use of electric vehicles at both consumer and institutional levels. The aim of this policy is to reduce carbon emissions and strengthen energy security. This step is part of the Government of India's broader strategy towards clean mobility, taken to achieve long-term environmental goals.