Why is Karnataka losing out on EV? We had the first EV policy in India - "Mohandas Pai". How can Karnataka make it right?
Why is Karnataka losing out on EV? We had the first EV policy in India - "Mohandas Pai". How can Karnataka make it right?

Why is Karnataka losing out on EV? We had the first EV policy in India – “Mohandas Pai”. How can Karnataka make it right?

February 20, 2023
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Why Ola chose Tamil Nadu over Karnataka for setting up its EV factory

Karnataka lost out this BIG investment @BSBommai @CMofKarnataka @drashwathcn @blsanthosh @narendramodi Why is the state losing out on EV? We had the first EV policy in india!very disappointed at the lack of concern at this loss @prashanthp @kiranshaw @kris_sg @rk_misra

 Policy Support: There have been concerns raised about the lack of clarity and effective implementation of Karnataka’s EV policy. Some of the key areas where the policy is seen as lacking include:

  • Lack of clear targets: Karnataka’s EV policy does not have clear targets for the adoption of electric vehicles in the state. While the policy sets out some goals such as the creation of charging infrastructure and promotion of EV adoption, it does not have specific targets for the number of EVs that should be on the road by a certain year or the percentage of new vehicle sales that should be electric.
  •  Limited incentives: While the Karnataka EV policy does offer some incentives for EV manufacturing, such as capital subsidies and land allotment, these incentives are seen as relatively limited compared to other states such as Tamil Nadu and Andhra Pradesh. There are also concerns that the incentives are not being implemented effectively and are not reaching the intended beneficiaries.
  • Lack of coordination: There have been complaints that the various government agencies responsible for implementing the EV policy are not coordinating effectively, which is leading to delays and confusion. For example, there have been delays in the rollout of the FAME 2 (Faster Adoption and Manufacturing of Electric Vehicles in India) scheme in the state, which offers incentives for EV buyers.
  • Limited charging infrastructure: While the Karnataka EV policy aims to create a network of charging stations across the state, progress in this area has been slow. There are concerns that the government is not doing enough to incentivize the private sector to invest in charging infrastructure, which is critical for the adoption of electric vehicles.

Overall, the Karnataka EV policy is seen as lacking in clarity, ambition, and effective implementation. There is a need for the government to work with stakeholders to create clear targets and incentives, improve coordination, and accelerate the development of charging infrastructure to make the state more attractive for EV investment.

Other Prominent Factors for this Decision:

  • Better infrastructure: Tamil Nadu has better infrastructure for the automotive industry compared to Karnataka. The state has a well-developed automotive ecosystem, including a strong supplier base, which reduces the cost of setting up a new factory. Tamil Nadu also has a good network of highways, which makes transportation of goods easier and more efficient.
  • Availability of skilled workers: Tamil Nadu has a large pool of skilled workers in the automotive industry, which makes it easier for companies to find and hire talent. The state has a number of technical institutes and vocational training centers that offer courses in automobile engineering and related fields. Karnataka also has a good pool of technical talent, but the availability of skilled workers can be improved further.
  • Political stability: Tamil Nadu has a stable political environment, which is considered favorable for long-term investments. The state government has been supportive of the automotive industry and has shown a commitment to developing the infrastructure required for the growth of the industry. Karnataka has seen some political instability in recent years, which may have influenced Ola’s decision to choose Tamil Nadu.
  • Proximity to major markets: Tamil Nadu is located close to major markets such as Chennai, Bangalore, and Hyderabad, which are key centers for the automotive industry. This makes it easier for companies to transport goods and reach their customers. While Karnataka is also well-connected to major markets, Tamil Nadu’s location may have been a factor in Ola’s decision.

Karnataka can still improve its EV policies and infrastructure to attract more investment in the future.

To attract more investment in the EV sector, Karnataka can focus on improving its policies and infrastructure. Some of the steps that can be taken include:

  • Clear and consistent policies: The state government can work on creating clear and consistent policies for the EV sector, which would provide more certainty and predictability for investors. This would involve coordination between various government agencies and stakeholders.
  • Infrastructure development: Karnataka can invest in developing EV charging infrastructure and other supporting infrastructure, such as roads and logistics. This would make the state more attractive for companies looking to set up EV manufacturing facilities.
  • Collaboration with industry: The state government can work closely with industry associations and companies to understand their needs and develop policies that align with their requirements. This would help to create a more supportive and conducive ecosystem for the EV industry.
  • Skill development: The government can focus on skill development and training for the local workforce, which would help to create a pool of skilled workers for the EV industry. This would also make the state more attractive for investors who require a skilled workforce.

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