India will award $3.5 billion in incentives to auto companies over a five-year period under a revised plan to boost the manufacturing and export of clean and advanced technology vehicles. Under the new proposal, only automakers who manufacture EVs and hydrogen fuel cell cars will be eligible.
Auto parts makers will get incentives to produce components for clean cars as well as for investing in safety-related parts and other advanced technologies like sensors and radars used in connected cars, automatic transmission, cruise control and other electronics.
The government is focused on adopting clean mobility so it can reduce its oil dependence and cut pollution, while also meeting its commitment under the Paris Climate Accord.
The idea is to promote the development of technology that is currently not manufactured in India but is imported either because regulation demands it or customers want those features in their cars, says Reuters. The incentive plan is part of India’s broader $27 billion program to attract global manufacturers so it can boost domestic production and exports.
Last updated: December 26th, 2025
