India's New EV Policy 2026: 15 Percent Import Duty and What It Means for Buyers

India's EV policy under SPMEPCI, the Scheme to Promote Manufacturing of Electric Passenger Cars in India, cuts the import duty on eligible electric cars from about 110 percent to just 15 percent for approved global carmakers, in return for a commitment to build cars locally. In plain terms, it is designed to pull the world's big EV brands into India, add factories and jobs, and widen buyer choice. The catch for now: the 15 percent rate applies only to premium imported EVs, so mass market buyers should not expect cheaper cars overnight. Here is exactly what the policy is, who it helps and what is still to be confirmed for 2026.

What is the SPMEPCI EV policy

SPMEPCI is the government's scheme to convince global electric car makers to set up manufacturing in India rather than only ship cars in. The core deal is simple: an approved company can import a limited number of electric cars at a 15 percent customs duty for five years, instead of the roughly 100 to 110 percent duty that fully built imported cars normally attract. In exchange, the company must invest in local production and hit rising local content targets. The Ministry of Heavy Industries opened the first application portal on 24 June 2025 and it ran to 21 October 2025. A fresh application window for 2026 is widely expected but is not officially confirmed, with reports suggesting it could be delayed while India finalises its trade talks with the European Union.

For an everyday car owner, this is a supply and choice story more than an immediate price story. It should bring more premium electric models to Indian showrooms over the next few years. Whichever EV you eventually drive, a good 4K dash camera and a compact digital tyre inflator are two accessories worth budgeting for from day one, since tyre pressure has a real effect on an EV's range.

Old duty vs new duty: what actually changes

The headline is the duty cut, but it comes bundled with strict conditions. The table below sets the old regime against the SPMEPCI terms. All figures are from the official scheme guidelines and the Ministry of Heavy Industries.

Two conditions matter most for buyers. First, the 15 percent duty applies only to imported EVs with a CIF (cost, insurance and freight) value above USD 35,000, which is roughly Rs 29 lakh before the duty and taxes are added, so this is squarely a premium car benefit. Second, the number of cheaper-to-import cars is capped at about 8,000 units per year per approved company. That keeps the near term impact small and premium, even if the long term factory investment is large.

Who the policy helps, and who it worries

Supporters say SPMEPCI is a clever way to trade a temporary import concession for permanent local investment. Global brands get a soft landing to test the market, buyers get more choice at the premium end, and India gets factories, jobs and technology transfer over time. Manufacturers reported to be keen include Mercedes-Benz, Volkswagen, Skoda, Hyundai and Kia. Tesla is often mentioned in the same breath, but the company has reportedly stayed out of SPMEPCI so far, choosing an import and showroom route instead (as reported, not officially confirmed by Tesla).

The main criticism comes from home. Domestic EV leaders like Tata Motors and Mahindra have argued that giving import concessions to global rivals, even limited ones, can undercut companies that already build and sell EVs in India at scale. The government's answer is the localisation staircase: the concession is short, the investment is real, and the local content targets rise quickly. Whether that balance holds will depend on how firmly the milestones are enforced.

As more electric cars arrive, cabin care becomes part of ownership too. A quiet, screen-led EV cabin is nicer with a tidy dashboard, so a wireless CarPlay adapter, a subtle hanging car perfume and a capable wet and dry car vacuum are easy upgrades that suit any new car, petrol or electric.

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Pair it with a cordless car vacuum and blower kept in the boot and cabin cleanups stop being a weekend chore.

Key takeaways

• SPMEPCI cuts import duty on eligible electric cars from about 110 percent to 15 percent for approved makers (confirmed).
• In return, a company must invest about Rs 4,150 crore and reach 25 percent local content by year 3 and 50 percent by year 5.
• The 15 percent rate applies only to imports above USD 35,000 CIF, capped near 8,000 units per year per applicant.
• The first window ran June to October 2025; a fresh 2026 window is expected but not officially confirmed and may be delayed.
• Near term this mainly affects premium imported EVs, so mass market buyers see little direct price benefit yet.

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