New Delhi, Apr 3 (KNN) India's decision to reduce import duties on electric vehicles (EVs) is expected to open the doors for Chinese EV makers to gain a larger foothold in the Indian market, analysts say.

The government recently announced a policy incentivising domestic EV manufacturing by offering import tax cuts for companies investing over Rs 4,150 crore and sourcing 25 per cent components locally.

"India's duty sops will directly or indirectly benefit Chinese manufacturers, as China leads in EV exports and components," told Shivani Palepu, Principal Analyst at Gartner to Telegraph.

She predicted every third EV on Indian roads could be from a Chinese company or joint venture in the next few years.

Ajay Srivastava, Founder of GTRI, noted the Indian market offers relief for Chinese firms facing declining EV exports to the EU and US amid subsidy probes.

"China's EV exports are declining due to anti-subsidy investigations and increased trade restrictions over subsidised cars/batteries," he said.

Initially, high-end Chinese models like BYD and MG Motors may see a rise, though long-term the market could be a mix of Indian brands in budget/mid-range and foreign premium offerings, Palepu stated.

China accounted for 59 per cent of global EV sales in 2022, with Chinese companies outpacing non-Chinese brands.

While demand remains strong domestically, the duty cuts make India an attractive export market for Chinese EV giants looking to expand their global footprint.

(KNN Bureau)