Budget 2022: Why upcoming financial statement is crucial for two wheeler industry in India for leading to a greener future

It’s simply impossible to imagine an Indian city without two-wheelers. A large part of the country's population primarily moves on two-wheelers.

In India, more than 25% of people commute to work either on bicycles or two-wheelers, as they are an affordable and reliable means of transport for people across urban and rural areas of the country.

Also almost one-third of all households own one. It’s widely held that close to 75 million two-wheelers are actually plying on Indian roads which include tier I, II and III cities. Moreover each year, India is adding 17-18 million two-wheelers to the roads.

But the fact is, two-wheelers pollute a lot! It may come as a surprise to many, but two-wheelers emit nearly the same CO2 emissions as a car. Therefore putting the majority of the onus of emission reduction on the shoulders of those riders.

In light of the above, the switch to electric vehicles is inevitable.

While the government has come up with their EV subsidy programmes, FAME (Faster Adoption and Manufacturing of Electric Vehicle) that have facilitated in driving the adoption of electric-scooters on Indian roads. However, the rate of adoption is still low primarily due to the heavy upfront cost and the lack of charging infrastructure.

This is where e-bikes come in! With their ease of use and maintenance, low upfront cost, high energy efficiency and portable design, e-bikes have rapidly been seen as the most viable option for intra-city mobility. Delivery personnel, for example, have seen an effective rise in delivery fulfilments when using e-bikes as opposed to the traditional scooter and motorcycle. E-bikes have become a very eco-friendly alternative to the large two-wheeler using population.

Therefore as opposed to electric two-wheelers, electric bicycles are the right transportation medium for the Government to promote as it not only helps in going green but at the same time helps people to be more active in their lifestyle thus reducing dependency on healthcare systems.

Also with COVID-19 and the multiple waves, consumers have realised the immense value of health and chosen to adopt a safer and more reliable way of vehicles to commute. So from the perspective of e-mobility the Government of India needs to bring many required changes to create optimism in this industry and help the industry and consumers grow multi-fold.

The electric bicycle industry is much due for its ask for inclusion into the FAME II subsidy scheme. Government should consider incentivizing the consumers. This will provide a big push to the e-bicycle industry which today stands to be around 40,000 units annual volume. Given the right push, this can go to over a million units per annum in the coming years.

Also the government should consider schemes for creating and regulating more dedicated cycling lanes. There are very few dedicated lanes today, and they too are most often occupied by the conventional 2-wheelers.

The dedicated lanes should be regulated with penalties etc. for violators.

Further, the government should offer income tax benefits to consumers who choose e-Bicycles considering fitness and going green aspects.

To conclude, knowing where the country stands with its two-wheeler pollution levels across Indian cities, it needs to take a stand to make the tough calls for a cleaner, greener urban future across the country. And with the New Year, time is now!

The author is CEO, Gozero Mobility.

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Ankit Kumar