A new report published on Wednesday by Indian-based CareEdge Advisory projects that the electric vehicle share in the country’s auto market will nearly double in the next three years.
In the fiscal year 2025, electric vehicles represented about 4% of the Indian market. There, the fiscal year started in April 1, 2024 and ended on March 31, 2025.
CareEdge predicts that the penetration will cross 7% by fiscal year 2028.
The firm said that this growth will be backed “by new model launches and government push for improving the charging infrastructure in the country,” as India aims for 30% of its auto market to be electrified by 2030.
According to the study, charging infrastructure is “scaling rapidly,” as public EV stations quintupled from 2022 to 2025, “led by strong government and state-level initiatives.”
Automakers are also said to be investing in infrastructure, all the while launching higher-range models in the country.
India has exempted the Basic Customs Duty on lithium-ion battery components, which supports national manufacturing, while facilitating electric vehicle adoption — as the batteries are the most expensive component of the car.
Despite that, the firm noted that the EV market expansion is also “subject to timely resolution of rare earth element (REE) disruption” by China.
“India, which relies heavily on Chinese REE imports, faces potential production curtailment across the automotive sector with the gradual depletion of older inventory,” the advisory firm had already warned in mid-June.
From 2021 to 2025, electric car sales rose from 5,132 vehicles to 107,645 units — a twentyfold jump in registrations.
However, cars — frequently referred to as “four-wheelers” in India — still represent a very small fraction of overall EV sales in the country, which are mainly driven by two and three-wheelers (motorcycles).
Compared to the global figures, the EV market share rose from 6.4% in 2023 to 7.8% in 2025 — the value CareEdge estimates electric cars to represent in 2028.
The firm highlights these values as one of “the ongoing challenges in mass adoption of electric cars” in India.
Another challenge is the lack of overseas new energy vehicle (NEV) brands established in the market.
Besides, India imposes a duty of 110% on imported vehicles that cost more than $40,000 — as it intends for automakers to set up production inside the country.
Chinese giant BYD has been present in India for over 18 years. It expanded to the market with a fully electric bus back in 2013.
In late 2022, it launched its first passenger vehicle in the Indian market — the Atto 3 SUV.
The company announced in March 2023 it had delivered 700 units of the SUV across India in just two months.
In June, BYD sold 476 vehicles in India — from a total of nearly 2.98 million passenger cars registered. The carmaker does not manufacture in India, however it intends to.
Business Standard reported earlier this year that the company is planning on constructing a EV and battery production plant in Telangana.
On Thursday, the Shenzhen-based company inaugurated its 42nd dealership showroom in India, which will feature its four-vehicle lineup of fully electric cars.
Tesla launched in the country earlier this week and, contrarily to BYD‘s plans, its sales in the country will be import-only.
It entered the country with its best-selling Model Y SUV, which is produced in both the US and in China’s Shanghai Gigafactory.
Orders for its refreshed Model Y can be placed with a starting price of ₹61,07,190, equivalent to about $71,200 — double the model’s price in several markets.
According to local media outlet New Delhi Television Ltd (NDTV), many people have raised concernsabout the high price of the vehicle, which also varies significantly from city to city due to local taxes and registration charges.
According to registration data from the Federation of Automobile Dealers Associations of India (FADA), passenger EVs represented 4.4% of all vehicles sold in June, while hybrids accounted for 8.1%.
Despite the low EV adoption rate, the EV market share nearly doubled from June 2024, when it was only 2.5%.
