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Last Updated:January 07, 2025, 16:14 IST

Experts said that the rise of electric vehicles presents a tremendous opportunity for MSMEs in India

Scaling EV rental services faces challenges such as the limited charging infrastructure and high upfront costs. (Representative image)

As India moves towards a greener future, the electric vehicle (EV) sector is quickly becoming a key player in the country’s growth trajectory. With growing investments, technological innovations, and government incentives, the rise of EVs presents a wealth of business opportunities, especially for Micro, Small, and Medium Enterprises (MSMEs). Experts weigh in on the challenges and opportunities that lie ahead.

Avesh Memon, Founder & CEO of Rilox EV; Rajeev YSR, CEO of Thunder Plus and Group CMO at ETO Motors; and Rahul Nain, Director of Business Operations at Luxorides, provide diverse insights into the EV sector. Their perspectives highlight the critical role of infrastructure, policy, innovation, and collaboration in unlocking the potential of electric mobility for MSMEs in India.

Building the Charging Infrastructure: A Key Challenge for Widespread EV Adoption by 2025

Avesh Memon points out that creating a robust EV charging infrastructure by 2025 is no small feat. The need to balance scalability with accessibility is critical, especially in rural areas where infrastructure could be underserved. Additionally, the strain on power grids, requiring upgrades and better peak demand management, must be addressed. “Collaboration between the public and private sectors is essential,” he says, emphasising that modular charging systems and universal standards can help overcome these hurdles.

Memon also believes that government policies and incentives will play a crucial role in boosting EV adoption. The introduction of subsidies under schemes like FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) has already made EVs more affordable, and continued support will further stimulate demand. By promoting local manufacturing and incentivising private investments, the sector can reach its potential by 2025.

Supporting the Growth of Affordable EVs: Balancing Quality, Innovation, and Affordability

With the rise of affordable EVs, companies like Rilox EV are focused on balancing innovation with cost-effectiveness. Memon explains that by localising supply chains and integrating cutting-edge technologies like IoT and AI, the company has managed to optimise vehicle performance while keeping costs low for the consumer. “Innovation, affordability, and sustainability drive our vision for the future,” he says, highlighting their strategy of modular designs that allow for easy upgrades without compromising on quality.

Sustainability and Carbon Emission Reduction: Aligning with Global Goals

Rajeev YSR, CEO of Thunder Plus and Group CMO at ETO Motors, stresses that India’s EV transition must contribute meaningfully to reducing carbon emissions. “Adopting clean energy sources for EV charging is paramount,” he says, noting that integrating solar and wind power into the grid will ensure that EVs contribute to emission reductions. YSR also advocates for localised manufacturing of EV components, including batteries, to reduce the environmental impact of imports.

State governments also have a critical role to play, especially in Tier-2 and Tier-3 cities. YSR suggests that localised incentives, decentralised charging networks, and public transport electrification programs can accelerate EV adoption in these areas, making EVs more accessible and affordable to a wider population.

Encouraging R&D in Battery Technologies: A Path to Sustainability

To make EV batteries more sustainable and reduce dependence on rare earth materials, YSR highlights the importance of R&D into alternative battery technologies. “Sodium-ion and solid-state batteries present viable alternatives,” he says. Policymakers, he argues, should incentivise collaborations between academic institutions, startups, and industry leaders to drive breakthroughs in battery recycling and second-life applications.

Business Opportunities for Rental Companies in a Shared Mobility World

With urban populations shifting towards shared mobility, rental companies are tapping into new opportunities. Rahul Nain, Director of Business Operations at Luxorides, explains that car rental services are evolving to meet the growing demand for eco-friendly and affordable travel. “With more consumers opting for shared mobility over ownership, companies like ours are diversifying fleets to include electric and hybrid vehicles,” he says.

However, Nain notes that scaling EV rental services faces challenges such as the limited charging infrastructure and high upfront costs. To address these concerns, Luxorides is focusing on educating customers about the benefits of EVs and alleviating range anxiety. Partnerships between rental companies and public transport systems could play a crucial role in accelerating EV adoption. “These collaborations can provide last-mile connectivity, making green travel solutions more accessible and affordable,” Nain adds.

An Ecosystem of Innovation, Policy, and Collaboration

The rise of electric vehicles presents a tremendous opportunity for MSMEs in India, from manufacturing and infrastructure development to R&D and rental services. The future of mobility is not only green but also offers multiple avenues for business growth and innovation. The road ahead will require collaboration between the public and private sectors, focused policies, and technological advancements, but the shift to a sustainable, electric future is well within reach.