MP drives electric future with tax exemptions and subsidies

Madhya Pradesh is rapidly becoming a hub for electric vehicles (EVs) in India. The state has seen a rise in the number of EVs, with people shifting from petrol and diesel vehicles to eco-friendly options. Government support, better infrastructure, and growing public interest have pushed this change. Indore has taken the lead and is now the electric capital of Madhya Pradesh. With rising EV sales, more charging stations, and a strong push from the local administration, Indore is setting an example for other cities.

Madhya Pradesh leads charge in electric cars

Data shows that EV registrations in Madhya Pradesh increased by 150% last year. In 2022, there were 28,000 EVs, now over 70,000. Most are electric two-wheelers (58%), while three-wheelers like e-rickshaws and e-autos account for 30%. The remaining 12% includes electric cars and buses.

Indore’s registered electric vehicles range from ₹8 lakh two-wheelers to ₹3 crore electric cars. The demand for electric two-wheelers is high, with sales showing they’re 18 times more popular than four-wheelers.

Experts predict Madhya Pradesh’s EV sector will grow by over 15% this year. Demand for EVs surged since the COVID-19 pandemic, with a nearly 40% sales increase in Indore. Rising fuel prices have contributed to this shift towards cost-effective and eco-friendly alternatives.

The rise in EV demand has encouraged investment in the state. During the Global Investors Summit in Bhopal, EaseMyTrip announced a ₹200 crore investment to manufacture electric buses in Madhya Pradesh. The company plans to introduce 500 e-buses by 2025, increasing the number to 1,000 by 2026.

Indore has positioned itself as a key player in EV manufacturing, producing copper lugs, a crucial component in Tesla and other EV brands. These components connect the lithium-ion battery to the vehicle, ensuring efficient energy transfer.

The Madhya Pradesh government is encouraging the shift to EVs by offering benefits. Mukesh Jain, Transport Commissioner of Madhya Pradesh, said, “Our state is leading in electric mobility. We’re promoting private EVs and investing in electric public transport to make our cities cleaner.” This shows the government’s commitment to making EVs the future of transportation.

EV growth in key cities

According to the Transport Department, Madhya Pradesh registered 1,98,944 electric vehicles from April 2023 to January 2025. Indore accounts for over 47,000 EVs, with Bhopal registering 27,048 EVs, Gwalior 21,665, and Jabalpur 18,395. The government aims to make Indore, Bhopal, Gwalior, Jabalpur, and Ujjain model electric cities to maximise EV usage through policy support and infrastructure development.

Indore has seen a 200% rise in EV registrations in two years, making it one of the fastest-growing EV markets in central India.

The Indore Municipal Corporation (IMC) is supporting this transition. There are over 100 public charging stations in the city, and 200 more are expected by 2025. Indore’s public transport is going electric, with more electric buses reducing pollution. The administration is encouraging food delivery services and ride-sharing companies to switch to electric vehicles by offering financial benefits.

Amit Soni, an EV dealer in Indore, said, “People are choosing electric two-wheelers and three-wheelers because they save money and help the environment.”

Tax-free, no fees, EV subsidies

The Madhya Pradesh government has introduced policies to support EV adoption. EV buyers get a 100% exemption from road tax and no registration fees. The government also provides subsidies of up to ₹20,000 for electric two-wheelers and ₹50,000 for electric three-wheelers.

The state is working to electrify public transport. Indore has expanded its electric bus fleet to 200, with plans for 300 more by 2025. Other cities, including Bhopal, Jabalpur, and Gwalior, are also getting electric buses. State Energy Minister Pradhuman Singh Tomar said, “We are committed to making Madhya Pradesh an EV-friendly state. Our policies help consumers and businesses adopt electric vehicles.”

Ravi Patel, a delivery executive, shared his experience, “Earlier, I used to spend ₹5,000 monthly on petrol. Now that I switched to an electric scooter, my expenses are down to ₹2,000, including charging costs. It has greatly improved my savings.” Taxi services and ride-sharing platforms are also shifting to electric cars, strengthening the EV ecosystem in Madhya Pradesh.

However, challenges remain. One major issue is the lack of charging stations in smaller cities and rural areas. While Indore and Bhopal have good charging networks, many places lack facilities, making long-distance EV travel difficult.

The high upfront cost of EVs is a concern, as many buyers find petrol and diesel vehicles more affordable initially. Even though EVs are cheaper in the long run, the initial price discourages some buyers. Other concerns include battery life, replacement costs, and proper disposal of used batteries.

MP’s electric vehicle policy

To solve these issues and speed up EV adoption, the Draft Madhya Pradesh Electric Vehicle Policy 2025 aims to speed up the adoption of EVs in the state by offering various incentives and creating a strong EV infrastructure. To encourage people to switch to electric vehicles, the government is planning to provide free parking for EVs for one year, ensure at least one charging point at every petrol pump, and grant 100% exemption on road tax and registration fees for new EV purchases.

At the same time, people using petrol or diesel vehicles may have to pay extra through a pollution cess and higher road taxes on luxury internal combustion engine (ICE) vehicles. This policy will replace the Madhya Pradesh Electric Vehicle Policy 2019, which aimed for 25% of new vehicle registrations to be electric by 2026.

The Draft Madhya Pradesh Electric Vehicle Policy 2025 aims to boost EV adoption by 2030, targeting 40% of two-wheelers, 70% of three-wheelers, 15% of four-wheelers, and 40% of buses to be electric. All public transport buses and government vehicles must switch by 2028, while commercial and logistics fleets must go fully electric by 2030. The policy excludes incentives for hybrid vehicles and requires new residential complexes, educational institutions, and government offices to provide dedicated EV parking.

The shift to EVs is not just about reducing pollution; it is also about saving money and creating a better future. With the right policies and growing public interest, Madhya Pradesh is moving toward a cleaner and greener future. The coming years will be crucial in ensuring these policies are implemented, helping the state become a model for electric mobility in India.

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