Indian EV companies are breathless due to India-China proximity! Know what is the danger?

BRICS Summit 2024 / Indian EV companies are breathless due to India-China proximity! Know what is the danger?

BRICS Summit 2024 - Indian EV companies are breathless due to India-China proximity! Know what is the danger?

BRICS Summit 2024: The Russian city of Kazan is hosting the 2024 BRICS summit, where Indian Prime Minister Narendra Modi and Chinese President Xi Jinping had an important meeting. This meeting has taken place at a time when China has agreed to India's right to patrol in Ladakh. This meeting is likely to strengthen India-China relations, but the growing proximity of these two countries has posed a new challenge to Indian electric vehicle (EV) companies. The Indian EV sector may now face tough competition from China's cheap and high-quality electric vehicles.

China's impact on Indian EV industry

Improving relations between India and China can have a big impact on the Indian EV industry. Charging infrastructure, expensive prices, low range and charging problems of electric vehicles are already major challenges for this sector. Apart from this, electric vehicles also face tough competition from hybrid and CNG cars, which is further pushing their popularity.

Decline in electric car sales

Electric car sales in India have been facing a decline recently. Tata Motors, which holds 62% of the EV market in India, recorded a decline of 16.28% year-on-year in September 2024. Despite the launch of Tata's new car "Curve EV", the company's sales were limited to just 3,621 units. This decline shows that more efforts are needed to boost the Indian EV market.

Entry of Chinese EV companies in India

After the meeting between Prime Minister Modi and Xi Jinping, India's doors may open for Chinese electric vehicle companies. Chinese companies are adept at manufacturing quality and long-range electric vehicles at low cost. By entering the Indian market, these companies can take advantage of the large and rapidly growing demand here.

Currently, Chinese EV companies mainly export their vehicles to North America and Europe. But they face difficulties due to the expensive tariffs there. At the same time, they can earn good profits by introducing cheap cars in India. MG Motor, which is working in collaboration with Indian company JSW, is a prime example of this. Apart from this, Chinese company BYD is also active in the Indian market.

Challenge facing Indian EV companies

If Chinese EV companies are allowed to enter India, it will be a big challenge for Indian companies. Chinese companies can offer better technology and long range vehicles at affordable prices, making it difficult for Indian companies to compete with them. Chinese companies are experts in manufacturing not only electric but also hybrid cars. In such a situation, Indian EV companies will have to improve their products and adopt innovative technologies so that they can survive in this competition.

Indian policy and difficulties of Chinese companies

However, due to the EV policy of the Indian government and its tough stance towards China, it will not be easy for Chinese companies to invest in India. Before investing in India, they will have to invest huge capital and set up local manufacturing units. Due to this clampdown, some Chinese companies have put their big investment plans in India on hold for the time being.

Conclusion

The growing ties between India and China are a double-edged sword for the Indian EV sector. On the one hand, the arrival of cheaper and better-tech vehicles from China can boost the Indian market, but on the other hand, it can become a big challenge for Indian EV companies. Indian companies will have to face this challenge by improving their technology and production capacity so that they can maintain their dominance in the domestic market.