Transition of India's entire fleet of two-, three-wheelers to electric needs $285bn financing: World Economic Forum

Published in collaboration with NITI Aayog, the WEF paper said the last-mile and urban delivery fleets are leading the adoption of electric two- and three-wheelers in India and are likely the first segments to transition completely to electric.

The complete electrification of India's entire fleet of two- and three-wheelers, the largest in the world, will require financing to the tune of $285 billion (nearly ₹23 lakh crore), according to a new white paper.

Published in collaboration with NITI Aayog, the World Economic Forum (WEF) paper said the last-mile and urban delivery fleets are leading the adoption of electric two- and three-wheelers in India and are likely the first segments to transition completely to electric.

But driver-cum-owners are hesitant to make the transition to electric due to higher upfront cost of acquisition, lack of confidence in new technology, unassured reliability and unestablished resale value, it added.

Two-wheelers and three-wheelers account for more than 80% of vehicle sales in India and the adoption of electric vehicles has been steadily rising in the past few years.

There are about 45 certified vehicle manufacturers of electric two- and three-wheelers in India in an otherwise consolidated auto market and the cumulative sales of these vehicles have reached an impressive 10 lakh units.

However, this remains a small portion of the country's total two- and three-wheeler fleet stock of 25 crore, leaving immense room for sustained growth.