Green Mobility: How Governments Are Supporting EV Adoption Globally?

The global shift toward green mobility is gaining momentum in 2025, with Governments Supporting EVs through bold policies, subsidies, and infrastructure development. Nations are driving EV adoption from the USA’s $7,500 EV tax credits under the Inflation Reduction Act to China’s leadership in battery production and NEV mandates. Europe enforces strict CO₂ targets, while India’s FAME II scheme accelerates growth. Australia is catching up with fuel efficiency standards, and the UAE is boosting EV sales with free charging and tax exemptions. With over $500 billion in EV investments and a projected 40% market share increase by 2030, government initiatives are making EVs more affordable, accessible, and sustainable. The integration of renewable energy, advanced charging networks, and automaker incentives ensures that the EV revolution is a necessity, not a choice. As climate change and energy security drive policies, the world is moving toward a cleaner, greener, and more electrified future.

Also, read: India’s Reduction of Import Taxes on Electric Vehicles: Implications for Domestic Automakers

The Global Imperative: Why Governments are Investing in EVs

Before diving into specific policies, it’s crucial to understand the driving forces behind government intervention. These include:

• Climate Change Mitigation: EVs produce significantly lower greenhouse gas emissions than traditional internal combustion engine (ICE) vehicles, contributing to national and international climate goals.
• Energy Security: Reducing dependence on imported oil and diversifying energy sources strengthens national energy security.
• Air Quality Improvement: EVs eliminate tailpipe emissions, leading to cleaner air and improved public health, particularly in urban areas.
• Economic Growth: The EV industry creates new jobs in manufacturing, infrastructure development, and related sectors, stimulating economic growth.

Inside the Global EV Movement: How Governments Are Supporting EV Adoption Globally?

The global shift to electric vehicles (EVs) is accelerating, driven by government policies, incentives, and infrastructure investments. Countries are actively promoting EV adoption to reduce carbon emissions and combat climate change.

Financial incentives play a major role in this transition. The U.S. Inflation Reduction Act offers tax credits of up to $7,500 for EV buyers, while India’s FAME II scheme provides purchase subsidies to boost EV affordability. Similarly, China leads the world in EV subsidies and manufacturing incentives, making EVs more accessible.

Infrastructure development is another key factor. Governments are investing billions to expand public charging networks, ensuring that EVs are convenient to use. The European Union is funding a fast-charging network, while China has built the world’s largest EV charging infrastructure.

Strict emission regulations further push the transition. The European Union and California have set 2035 deadlines to phase out gasoline and diesel cars, making EVs the future of mobility.

With tax benefits, subsidies, and infrastructure expansion, governments worldwide are shaping a cleaner, greener transportation landscape, ensuring that EVs dominate the future of mobility.

Also, read: Why EV Sales in Nepal Surpass ICE Vehicles: A Look at Indian EV Brands’ Presence

1. India

Electric vehicles offer lower emissions as compared to traditional gasoline vehicles and hence leave a lower carbon footprint. Among the transportation options, EVs show potential in addressing climate change risks.  Governments worldwide have implemented policies to increase the penetration of electric vehicles.

In India, the government has introduced various schemes across the EV value chain to incentivize its production, adoption, and usage. In July 2023, NITI Aayog laid down the roadmap for the growth of electric mobility in India aligning it with the Indian government’s vision of achieving net Zero emissions by 2070.

The NITI Aayog has laid specific targets by vehicle type in pursuit of its objective to achieve 30% EV sales penetration by 2030. The targets by specific vehicle type are:

• 30% in Private cars
• 70% of Commercial vehicles
• 40% in Busses
• 80% in two-wheeler
• 80% for three-wheeler

Further, the government aims for 100% local production of EVs as part of the ‘Make in India’ initiative.

Government Initiatives Supporting EV Adoption

1. FAME India

FAME stands for Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India. The policy aims to encourage people to use electric vehicles in the country. The scheme is a government subsidy program part of the National Electric Mobility Mission Plan (NEMMP). It started in 2015 and has two parts: FAME India Phase I and Phase II.

2. FAME India Phase I

In this phase of the scheme, the focus was on four main areas: (i) Generating demand, (ii) Advancing technology, (iii) Piloting projects, and (iv) Developing charging infrastructure.

In Phase I, ~ US$ 65.3 million (Rs. 529 crore) was allocated for a period spanning four years, from 2015 to 2019. This allocation facilitated support for around 2.78 lakh Electric and hybrid vehicles, totaling incentives of US$ 42.3 million (Rs. 343 crore). Also, 520 charging infrastructures and 465 buses received approval for funding across different cities and states as part of this initiative.

3. FAME India Phase II

It was started in April 2019 with a total budget of US$ 1.43 billion (Rs. 10,000 crore).

This phase focuses mainly on making public and shared transportation electric. It provided incentives totaling US$ 234 million (Rs. 1,869 crore) to support 470,000 electric vehicles. Additionally, it approved 6,315 e-buses for use in over 65 cities and sanctioned 2,877 charging stations. Over 100 electric vehicle models were also approved during this period.

As part of the FAME-II scheme, financial assistance, such as subsidies, was provided for establishing public charging infrastructure. This initiative aims to build trust and confidence among electric vehicle users.

4. FAME India Phase III 

The government is currently working on the third phase of the FAME scheme, which is expected to be launched in the next 1-2 months. The FAME-III scheme will replace the Electric Mobility Promotion Scheme (EMPS) 2024. FAME-III will continue India’s commitment to electric mobility, with a focus on expanding EV adoption across various vehicle segments, including heavy-duty trucks.

5. Production Linked Incentive (PLI) Scheme

PLI scheme for the automotive sector was launched in September 2021 with a budget of US$ 3.1 billion (Rs. 25,938 crore).

Its aim was to enhance domestic manufacturing of advanced automotive technology (AAT) products and attract investments into the automotive manufacturing value chain, surpassing the initial target estimate of US$ 5.1 billion (Rs. 42,500 crores) over a 5-year period.

6. Electric Mobility Promotion Scheme

The scheme started in April 2024 and will end in July 2024 with a total budget of US$ 60.18 million (Rs. 500 crore). It aims to enhance green mobility and encourage electric vehicle manufacturing in the country.

Electric two-wheelers and three-wheelers are only applicable to the scheme.

The Scheme supports 3.7 lakh EVs, comprising 3.3 lakh` Electric 2 wheelers, and 38,828 Electric 3 wheelers (which also includes 13,590 rickshaws & e-carts and 25,238 e-3Ws in the L5 category), offering incentives exclusively for advanced battery-equipped vehicles.

7. Battery Swapping Policy

The government introduced a battery-swapping policy to reduce lengthy charging durations and enhance EV efficiency by swapping drained batteries with fully charged ones. The initial draft for this policy came in February 2023.

The policy addressed the standardization of battery sizes and other specifications, particularly for two- and three-wheelers. Furthermore, the preliminary policy encompassed matters concerning battery safety protocols, individual identification codes for each battery, recycling, and refurbishment processes, and the potential implementation of a subsidy scheme.

Other Key Policies, Incentives, and Government Initiatives

• The exemption from customs duties for importing machinery and equipment required to create lithium-ion cells for electric car batteries was extended in the Union Budget 2023–2024.
• Both commercial and private battery-operated vehicles receive green license plates and are not required to obtain permits.
• The Goods and Services Tax (GST) on electric vehicles has been lowered from 12% to 5%, while the GST on charging stations for EVs has been reduced from 18% to 5%.
• Due to the constant effort from the government 12,146 public EV charging stations are operational across the country.
• Waiver on road tax on EVs to lower the initial cost of EVs.
• State-Level Incentives: Delhi, Maharashtra, and Tamil Nadu offer road tax exemptions and purchase rebates.
• Income Tax Deductions: EV buyers can claim deductions on loan interest payments.
• Charging Infrastructure Development: The government plans to install more than 5,000 fast chargers across major highways.
• State-Level Policies: Many Indian states have introduced their own EV policies, offering additional incentives and support for charging infrastructure.
• Focus on Two- and Three-Wheelers: India’s EV strategy prioritizes the electrification of two- and three-wheelers, which are widely used for transportation.

Also, read: Driving the Future: A Brief History of Electric Vehicles

EV-friendly States that Offer the Best Incentives to Buyers

The Telangana government has announced a 100% exemption on road tax and registration fees for electric vehicles (EVs) to boost their adoption and reduce vehicular pollution. State Minister for Transport and BC Welfare, Ponnam Prabhakar, made this announcement, which applies from November 18, 2024, to December 31, 2026, under Government Order (GO) 41. The waiver covers two-wheelers, four-wheelers, taxis, auto-rickshaws, light goods carriers, tractors, and buses, including TSRTC-operated EVs and private company transport vehicles. The government also plans to enhance EV charging stations and infrastructure to further support the transition to electric mobility in the state.

The Uttar Pradesh government has announced a 100% exemption on road tax and registration fees for electric vehicles (EVs) to promote sustainable mobility. As per the state’s EV policy, this exemption applies to all EVs purchased and registered in Uttar Pradesh for three years from the policy’s notification date. For EVs manufactured within the state, the exemption extends to five years. The policy covers all types of EVs, including two-wheelers, three-wheelers, four-wheelers, Strong Hybrid Electric Vehicles (HEV), Plug-in Hybrid Electric Vehicles (PHEV), Battery Electric Vehicles (BEV), and Fuel Cell Electric Vehicles (FCEV), supporting the shift towards greener transportation.

As every Indian state frames its EV policy in alignment with the FAME subsidy scheme, the incentive or electric car subsidy will vary from state to state. Here are a few states that offer the best EV subsidy to buyers-

State	Two-Wheeler Subsidy	Three-Wheeler Subsidy	Four-Wheeler Subsidy	Additional Benefits
Gujarat	Up to ₹20,000	Up to ₹50,000	Up to ₹1.5 lakh	—
Maharashtra	Up to ₹25,000	Up to ₹30,000	Up to ₹2.5 lakh	—
Meghalaya	Up to ₹20,000	NA	Up to ₹60,000	—
Karnataka	No direct subsidy	No direct subsidy	No direct subsidy	Subsidy provided to EV manufacturers
Andhra Pradesh	No direct subsidy	No direct subsidy	No direct subsidy	Exemption from registration charges & road tax
Telangana	No direct subsidy	No direct subsidy	No direct subsidy	Full exemption from registration charges & road tax
Tamil Nadu	No direct subsidy	No direct subsidy	No direct subsidy	100% road tax waiver & zero registration charges (policy under review)
Kerala	No direct subsidy	₹10,000 – ₹30,000	No direct subsidy	50% road tax discount for the first five years

“EVs Deployed at NITI Aayog Under CESL’s ‘Electric Vehicle as a Service’ Initiative”

Convergence Energy Services Limited (CESL), a subsidiary of Energy Efficiency Services Limited (EESL) under the Ministry of Power, is leading the ‘EV as a Service’ initiative to promote electric mobility. In alignment with India’s Net Zero target by 2070, 20 electric cars were flagged off at NITI Aayog by key officials, including Sh. Sudhendu J. Sinha, Sh. K. S. Rejimon, Sh. Vishal Kapoor, and Sh. Rajneesh Rana. This initiative ensures the deployment of new electric cars with a complete end-to-end solution, covering repair, maintenance, and compliance with regulations such as the Motor Vehicle Act, labor laws, and Make-in-India guidelines. Beneficiaries incur no upfront costs, as lease payments are structured monthly for up to five years. CESL has already deployed approximately 2,200 electric cars across various central and state government departments and CPSEs and aims to expand this to 5,000 EVs in government fleets within the next two years. This initiative aligns with India’s broader goal of achieving 30% EV adoption by 2030, reinforcing sustainable transportation efforts.

EV Growth in 2025

• India’s EV market is poised for significant growth, driven by government incentives and increasing consumer awareness. The focus will be on expanding charging infrastructure and promoting domestic manufacturing. The two and three-wheeler market will be largely converted to electric.
• 10 million EVs are expected on Indian roads.
• The government targets 30% electrification of private cars, 70% of commercial vehicles, and 80% of two-wheelers by 2030.

2. USA

Key Policies and Incentives

• Inflation Reduction Act (IRA): Offers up to $7,500 in tax credits for new EV purchases and $4,000 for used EVs.
• Infrastructure Investment and Jobs Act (IIJA): Allocated $7.5 billion for a national network of 500,000 charging stations by 2030.
• Zero-emission vehicle (ZEV) Mandates: States like California, New York, and Washington mandate 100% EV sales by 2035.
• Corporate Average Fuel Economy (CAFE) Standards: Tightened regulations push automakers to increase EV production.
• Federal Incentives: The Inflation Reduction Act (IRA) of 2022 is a cornerstone of the US EV strategy. It offers significant tax credits for EV purchases, with stringent requirements for domestic manufacturing and battery sourcing. By 2025, these credits are expected to significantly lower the upfront cost of EVs for consumers.
• Infrastructure Investment: The National Electric Vehicle Infrastructure (NEVI) Formula Program is allocating billions of dollars to build a nationwide network of EV charging stations, particularly along major highways. This addresses range anxiety and makes long-distance EV travel more feasible.
• State-Level Policies: States like California, New York, and Massachusetts are leading the charge with ambitious zero-emission vehicle (ZEV) mandates, requiring automakers to sell an increasing percentage of EVs. These states also offer additional incentives and support for charging infrastructure.
• 2025 Outlook: By 2025, the impact of the IRA and NEVI program will be evident, with a significant increase in EV sales and a more robust charging infrastructure. The US is aiming for 50% of new vehicle sales to be electric by 2030, and the policies being implemented will be heavily tested by 2025.

EV Growth in 2025

• The EV market share in the US is expected to reach 20% by 2025.
• Tesla, Rivian, and legacy automakers like Ford and GM are investing billions in EV and battery manufacturing.

Also, read: Vintage Electric Cars: Rediscovering the Pioneers of the Past

3. China

Key Policies and Incentives

• New Energy Vehicle (NEV) Quota System: Requires automakers to produce a certain percentage of EVs or buy clean vehicle credits.
• Subsidies on EV Purchases: Though scaled back, buyers can still receive up to $1,500 in direct incentives for affordable EV models.
• Charging Infrastructure Investment: The government is expanding high-speed chargers along highways and urban centers.
• Local Production Support: Companies like BYD and NIO receive tax breaks and research grants for battery innovations.
• New Energy Vehicle (NEV) Mandates: China’s NEV mandate requires automakers to produce and sell a certain percentage of electric and plug-in hybrid vehicles. This has spurred significant investment in EV technology and manufacturing.
• Subsidies and Incentives: While direct subsidies have been phased out, China continues to offer purchase tax exemptions and other incentives for EVs. Local governments also play a crucial role in providing charging infrastructure and other support.
• Infrastructure Development: China has invested heavily in building a vast network of public charging stations, making it easier for EV owners to charge their vehicles.
• Battery Dominance: China controls a significant portion of the global battery supply chain, giving it a competitive advantage in the EV market.
• 2025 Outlook: China is expected to maintain its leadership in the EV market, with continued growth in sales and infrastructure development. The focus will shift towards improving battery technology and expanding the charging network to rural areas.

EV Growth in 2025

• Over 50% of global EV sales in 2025 will come from China.
• The country aims for 40% of new car sales to be EVs by 2030.

4. Australia

Key Policies and Incentives

• National Electric Vehicle Strategy (NEVS): aims for 1.2 million EVs by 2030.
• Fuel Efficiency Standards: Implemented in 2025 to push automakers towards EVs.
• State-Level Rebates:
  • New South Wales offers $3,000 subsidies for EVs under AUD 68,750.
  • Victoria and Queensland provide stamp duty waivers and free registration for EV buyers.
• Charging network expansion:
  • Investment in fast-charging hubs every 150 km on highways.
  • Support for home and workplace charger installations.
• National Electric Vehicle Strategy: The Australian government has launched a national EV strategy, which includes measures to reduce import tariffs, improve fuel efficiency standards, and invest in charging infrastructure.
• State-Level Incentives: Several Australian states offer incentives for EV purchases, such as stamp duty exemptions and rebates.
• Charging Infrastructure Investment: The government is investing in building a network of public charging stations, particularly along major highways.

EV Growth in 2025

• Australia’s EV market is expected to grow significantly, driven by government policies and increasing consumer demand. The focus will be on expanding charging infrastructure and addressing range anxiety.
• EV sales in Australia are expected to hit 20% of new car sales by 2025.
• Popular EV brands include Tesla, BYD, and Hyundai.

Also, read: Affordable EV Loan Options in India: Drive Green with Easy Financing

5. UAE

Key Policies and Incentives

• Dubai’s Green Mobility Strategy 2030: Targets 30% of Dubai’s government fleet to be electric by 2030.
• Subsidies on Charging and Registration:
  • Free EV charging at DEWA Green Charger stations.
  • Exemption from registration and renewal fees for EV owners.
• Investment in Charging Infrastructure:
  • 1,000 new public charging points in Dubai and Abu Dhabi by 2025.
• EV Loans and Tax Benefits: Banks like Emirates NBD and ADCB offer low-interest loans for EV buyers.
• Dubai Green Mobility Initiative: Dubai has launched a green mobility initiative, which aims to increase the number of EVs on its roads.
• Charging Infrastructure Development: The UAE is investing in building a network of public charging stations, including fast chargers.
• Government Incentives: The government offers incentives for EV purchases, such as reduced registration fees and free parking.

EV Growth in 2025

• The UAE’s EV market is expected to grow rapidly, driven by government policies and increasing consumer awareness. The focus will be on expanding charging infrastructure and promoting sustainable transportation.
• EV sales are expected to triple, driven by luxury EV demand and business fleet transitions

6. Europe

Key Policies and Incentives

• European Union CO2 Emission Targets:
  • Automakers must reduce fleet emissions to 50% of 2021 levels by 2030.
• Bans on new gasoline cars:
  • Norway (by 2025), UK, France, Germany (by 2030-2035).
• Tax Exemptions & Road Incentives:
  • Norway: 25% VAT exemption on EVs.
  • Germany: Up to €9,000 purchase subsidies for EVs.
  • Netherlands & France: Free parking and road tax waivers for EVs.
• Charging network expansion:
  • EU mandates one fast charger every 60 km on highways.
  • Germany, the UK, and France invest billions in nationwide EV infrastructure.
• EU Green Deal: The EU Green Deal sets ambitious targets for reducing greenhouse gas emissions and promoting sustainable transportation, including a phase-out of ICE vehicles by 2035.
• National Policies: Countries like Norway, Germany, and the Netherlands have implemented strong EV policies, including generous subsidies, tax exemptions, and charging infrastructure development.
• Charging Infrastructure Mandates: The EU is implementing regulations to ensure the widespread availability of public charging stations.
• Battery Alliance: The European Battery Alliance aims to build a competitive European battery industry.

EV Growth in 2025

• Europe is expected to maintain its leadership in the EV market, with continued growth in sales and infrastructure development. The focus will be on expanding charging infrastructure, developing advanced battery technology, and promoting sustainable mobility.
• Over 50% of new car sales in Western Europe will be EVs.
• Leading brands: Volkswagen, Tesla, Renault, and BMW

Conclusion: The Final Words

The global transition to green mobility is no longer a distant dream but a fast-approaching reality, thanks to aggressive government policies, financial incentives, and infrastructure investments. Nations worldwide are implementing subsidies, tax breaks, charging network expansions, and manufacturing incentives to make EVs more accessible and appealing. The United States is driving change with tax credits and charging infrastructure expansion, while China remains a global leader with strong production policies and incentives. India is leveraging FAME II subsidies and tax reductions to accelerate EV penetration, whereas Australia is catching up with state-level rebates and fuel efficiency standards. The UAE is pioneering EV adoption in the Middle East with free charging and registration benefits, while European nations are setting the benchmark with EV mandates, road tax exemptions, and CO₂ emission targets. With global EV sales projected to exceed 40% by 2030, the next few years will be crucial in shaping a sustainable, emission-free transportation future. The road to green mobility is being paved by forward-thinking policies, and as technology advances, EV adoption will continue to surge, creating a cleaner and greener planet for future generations.

Also, read: Understanding EV Insurance Costs: Factors and Tips to Save Money