Venkat Rajaraman of Cygni | Budget Expectations vs. Reactions

Venkat Rajaraman, Founder and CEO, Cygni is among the few who shared his expectations before the budget. Did the budget meet his expectations?

Thought Habitat is seeing a complete inflow of budget expectations from various business leaders. On the other hand, we also had some entrepreneurs sharing their expectations on the 2022 budget. Venkat Rajaraman, Founder and CEO, Cygni is among the few who shared his expectations before the budget.

Did his expectations meet the budget outcome and what was his reaction to the budget? Let us explore.


As per SMEV (Society of Manufacturers of Electric Vehicles), the sales of total electric vehicles in India is expected to be around 10 lakh units in 2022, a very bold prediction indeed!   There is good traction expected of high-speed scooters and for battery swapping.

Significant policy interventions have happened in 2021.  Two notable ones are a) the government’s extension of the FAME II (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles), an ambitious scheme to promote electric mobility, by two years till March 31, 2024, was welcome and b) Government announced a production-linked incentive (PLI) scheme for the auto sector. It was ostensibly to overcome the cost-disadvantages of the industry for the manufacture of advanced automotive-technology products in India.

The incentive structure will encourage the industry to make fresh investments for indigenous global-supply chains of advanced automotive technology products.  It is estimated that over a period of five years, the PLI Scheme for the automobile and auto components industry will lead to fresh investments of over Rs 42,500 crore.

With this background, the following are the pre-budget expectations from the Energy Industry. 

1) Enhance policy and market collaboration across mobility, energy, and real estate sectors.  These sectors working in silos will result in sub-optimal outcomes. A joint policy task force across these sectors will accelerate EV adoption and strengthen the business case for efficient electric fleets, effective space management, charging network creation, and grid management. It is only when these sectors collaborate that large-scale capital can be attracted to this transition.

2) India to focus on fleet-led adoption and infrastructure build-up.  Electrification of commercial fleets (especially in 2W and 3W) can provide the demand signal and scale required to attract manufacturing and R&D investments allowing consumer adoption to follow.

3) Enhance FAME-II scope to incorporate battery swapping:  There is merit in expanding the scope of FAME-II to accommodate battery swapping for 2Ws and 3Ws.  There is an urgent need to review this scheme from a battery swapping perspective.

4) Focus on non-fiscal incentives to maximize impact with limited resources: Instituting Low-Emission Zones (LEZs) in congested urban centers, relaxing day-time municipal entry for electric urban freight, and legalizing e-bike taxis are a few policy opportunities that will support early EV adoption without the need to expend resources.

5) Enable access to clean energy to power clean mobility:  The transition to electric mobility makes the most sense when it is powered by renewable energy. India must liberalize regulations for charging stations to aggregate demand and procure renewable power.

Budget Outcome & his Reaction

Clean mobility as a growing important segment; and keeping energy transition as the backbone, the focus has been on strengthening to enable access to clean energy to power clean mobility. This will help to develop sustainable and innovative business models for battery and energy as a service to improve the efficiency in the EV ecosystem in India.

The announcement of a battery swapping policy and push for clean tech and electric vehicles will certainly benefit the EV segment and vehicle makers in India and will promote the sales of electric vehicles, battery production and development in the country, adding special privilege to private sector. Adding to it, battery swapping policy and interoperability standards will be implemented to overcome some challenges negatively impacting EV adoption in the country.

While his expectations on battery swapping and clean energy were met, there were some misses too. Yet, his comments are pretty welcoming the budget.

Keep watching this space for more such updates!

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