Decoding Draft Andaman and Nicobar Islands Electric Vehicle Policy 2022

Tarun Karthick

Campbell Bay, 01/04/2022

Directorate of Transport, Andaman and Nicobar Administration has published the draft Andaman and Nicobar Islands Electric Vehicle Policy 2022 on its website. The policy which seeks to promote the adoption of electric vehicles in the Islands instead of the polluting vehicles powered by fossil fuel is going to have a deep impact on the tourism service providers.

The objective of the A & N Islands Electric Vehicle Policy, 2022 as stated in the draft is to accelerate the adoption of EVs (Electric Vehicles) for improvement in the air quality such that they contribute to 30% of the new registrations by 31st December, 2026.

If the  A & N Electric Vehicle Policy, 2022 is notified in its present form the following changes will have a huge impact on the lives of the ordinary citizens and tourism service providers:

1. All new two wheelers involved in commercial activity in A & N Islands will have to switch to complete electric by 31st December 2025.
2. Only Electric Two Wheelers will be sold in the Islands beyond 31st December 2030.
3. All new two wheelers to be registered in the two Islands of Swaraj Dweep and Shaheed Dweep for commercial activity shall be electric from the date of notification of the policy.
4. All new licenses for Rent a Motorcycle Scheme will only be issued for electric two wheelers including addition of two wheelers in the existing license from 1st January 2023. 
5. Registration will only be given to Three Wheeler Electric Rickshaws in the two Islands of Shaheed Dweep and Swaraj Dweep once the policy is notified. 
6. Only Electric Cars will be given Contract Carriage Permit in Shaheed Dweep and Swaraj Dweep from the date of notification of the policy.  
7. 100% Electrification of the new ride hailing services will be achieved by 2030 in three Islands Port Blair, Swaraj Dweep and Shaheed Dweep.
8. Starting April 2023 all new Govt. Vehicles (Owned/Leased) operating in Port Blair will be electric.
9. UT Administration has committed to argument its fleet of busses through 100% new electric busses by State Transport Service. 40% of all new stage carrier busses including by Private Operators to be electric by 2025. 

In addition to the above-mentioned changes the Andaman and Nicobar Islands Electric Vehicle Policy 2022 will also introduce Pollution Cess and Clean Fuel Cess right from the date, the policy comes into force.

Pollution Cess will be levied on vehicles powered by Internal Combustion Engine\sold in the UT after the notification of the policy. One time cess will be levied at the time of initial registration, Renewal of Registration, Fitness of ICE Commercial Vehicles on completion of 10 years & during registration when the vehicles are brought from the mainland.

The Pollution Cess on Two Wheelers will be INR 800, Three Wheelers – INR 1500 and LMV and Other Vehicles – INR 4000.

Clean Fuel cess will be levied on the sale of petrol and diesel in Andaman and Nicobar Islands. For every litre of Petrol INR 0.50 will be levied as Clean Fuel Cess. For every litre of Diesel INR 0.75 will be levied as Clean Fuel Cess.

Andaman and Nicobar Islands on 31.10.2021 had 1,51,436 registered vehicles and on an average 7000 vehicles are added every year. Nearly 70% of the registered vehicles are operating in Port Blair and its environs.

Nearly 72% of vehicles out of the total registered vehicles are two wheelers.

The draft Andaman and Nicobar Islands Electric Vehicle Policy, 2022 defines a Transition Strategy which is as follows:

1. The transition strategy would be multi-pronged, which would include the creation of common charging infrastructure, incentivising the transition (end user), standardising the specifications, creating enabling policies and regulations, promoting localisation coupled with skill development. 
2. Balancing of the peak and off – peak power demand for the electric utility. 
3. Promoting shared mobility and clean transportation. 
4. Establishment of public charging stations at various locations in this UT. 
5. Waiver off Road tax, parking fee and Permit fee on electric vehicles having advance battery. 
6. Constitution of UT Electric Vehicle Board and Transport Department as the Nodal Department.
7. Creation of a non lapsable UT Electric Vehicle fund to be funded through pollution cess applied on new fossil fuel run vehicles, clean fuel cess on sale of diesel & petrol and grants from the UT Budget. 
8. Providing incentives to the buyers of Electric Vehicles from the UT Electric Vehicle Fund at the rate as directed by UT Electric Vehicle Board subject to the condition that the electric vehicle against which the claim is made, must be kept in this UT for a minimum period of 05 years. In case of transfer to other states within a period of 05 years, the incentive claimed against such electric vehicle shall be refunded by the owner. The purchase incentives provided are over and above the existing FAME II incentives. 
9. The purchase incentives offered under the policy for all Electric vehicles shall be given to the registered owners through dealers by the Transport Department based on the claims made by the individual buyers after the purchase of the vehicle. 
10. If the battery is not sold with the vehicle, 50% of the purchase incentive shall be provided to the vehicle owner & the remaining amount upto 50% would be provided to the Energy operators defraying the cost of any deposit that may be required from the end users for use of a swappable battery. 
11. Operational guidelines for delivery of purchase incentives offered under the policy shall be issued from time to time by the Transport Department with the approval of UT Electric vehicle Board, A & N Islands as Competent Authority. 

The policy states that the Transport Department has been notified by the UT Administration as the Nodal agency to initiate, develop and sustain e-mobility in the UT. 

Andaman and Nicobar Administration plans to incentivize the  buyers of Electric vehicles from the UT Electric Vehicle Fund in the following manner for different classes of vehicles:

The proposed demand incentives are as follows:

S.No.	Vehicle Segment	Max. No of vehicles to be incentivized	Proposed Incentive (INR)	Proposed maximum incentive/vehicle (INR)	Proposed Early Bird Incentive (INR)	Proposed maximum incentive for early bird vehicles (INR)
1	Electric two-wheeler	3000	10,000 per kWh	20,000	12,000 per kWh (for first 500 vehicles)	24,000
2	E-Autorickshaw (Passengers)	250	10,000 per kWh	30,000	12,000 per kWh (for first 50 vehicles)	40,000
3	E-Rickshaw/E-Carts	50	–	25,000	–	30,000 (for first 10 vehicles)
4	E-Carriers (L5N and N1 Category)	250	–	30,000	–	40,000 (for first 50 vehicles)
5	E-cars (Passengers)	720	10,000 per kWh	1,00,000	12,000 per kWh (for first 70 vehicles)	1,20,000 per vehicle
6	Hybrid/ fuel cell
7	E-buses	30	10% of vehicle cost.	8,00,000	15% of vehicle cost (for first 05 buses)	10,00,000

The proposed scrapping incentives are as follows:

S.No	Vehicle Segment	Scrapping Incentive (max) INR
1	Electric Two Wheeler	5,000
2	Electric Three Wheeler	10,000
3	Electric Carrier	20,000
4	Electric Four Wheeler	25,000
5	Electric Bus	50,000

Apart from the monetary incentives, the following other incentives have also been proposed for the buyers of Electric Vehicles in Andaman and Nicobar Islands:

1. Road Tax on Electric Vehicles may be fully exempted.
2. Two E-Auto permits shall be granted to one applicant.
3. The Auto Rickshaw permit, bus permit, goods carrier permit, commercial light vehicle permit linked to the de-registered ICE can be surrendered and exchanged for new permits respectively for the same class of Electric Vehicles at no additional cost.

Incentives have also been announced for Charging Infrastructure in Andaman and Nicobar Islands. One of the key objectives of the A & N Islands Electric Vehicle Policy, 2022 is to provide accessible public charging facilities within three kms travel from anywhere in the UT.

The policy also lays framework for recycling of EV Batteries in the Islands.

Andaman and Nicobar Electric Vehicle Policy, 2022 is futuristic and while the policy clearly aims to promote the adoption of Electric Vehicle in the Islands it still lacks the most crucial element i.e. participation of public representatives and giving power in the hands of those chosen by the public instead of bureaucrats. 

The UT Electric Vehicle Board is a high powered committee that is proposed to be constituted to monitor the implementation of the policy and develop procedures and modalities. The committee comprises of only bureaucrats and no public representatives.

In a democracy, all crucial powers should always rest with those chosen by the public rather than public officials for ensuring accountability. 

The UT Electric Vehicle Board should comprise of elected public representatives from the local bodies who should be assisted by the bureaucrats to monitor the implementation of the policy and develop procedures and modalities.

Any suggestions/comments for inclusion or omission in the draft EV Policy may be brought to the notice of the Director (Transport) either in-person or on email dirtpt.and@nic.in . The draft A & N Islands Electric Vehicle Policy is now open for suggestions/comments, however, the last date for sending the suggestions/comments is not categorically mentioned. The policy was published on the Directorate of Transport website on 25/03/2022, therefore, should be available for suggestions/comments until 30 days from the date of publishing on the website. 

The Draft Andaman and Nicobar Islands Electric Vehicle Policy, 2022 is embedded below: