The electric vehicle industry in India is at an important juncture in 2021. With fuel prices at an all-time high, many people are planning to make the switch. On the other hand, we cannot underestimate the practical limitations of using electric vehicles in India. We are at a point from where the market can really take off with growth in electrical automobile technologies.
The high initial investment is a challenge to making a full-fledged transition. With the overwhelming number of traditional fuel vehicles on the streets, the electric vehicle industry will need many years of steady growth to reach a competitive level. However, the growing phase will see many companies and startups finding tremendous success.
Indian Electric Vehicle market: A growing industry
One of the major reasons behind growing investor interest in the EV (electric vehicle) sector is the legal provisions for 100% foreign direct investment in the sector. Many infrastructural developments are waiting to take place in the sector. With the growing need for investment for constructing manufacturing hubs, charging stations, vehicle parts, and more, those interested in stock trading as shares CFDs have a sea of interesting possibilities ahead.
Even governmental policies are encouraging the transition. In a recent move, the cabinet approved an incentive scheme for hydrogen fuel cell and electric vehicle manufacturing.
Statistics that tell a story
If we study electric vehicle statistics in India, we can understand a strong trend towards innovation and development. 121,900 electric vehicles were sold in India in 2021. The average growth of the sector is projected to be around 26% between 2020 and 2023. In the light of growth prospects, stock trading experts are arguing in favor of investing in the EV sector. If the growth rate maintains itself, we can see tremendous potential in any investment in the sector. For these reasons, the EV sector may heavily impact the stock trading scenario in India.
Disparities within the sector
Within the EV sector, there is a disparity in the potential for growth. As the trends suggest at present, the 2-wheeler EV sector is showing much more potential than commercial electric vehicles. Heavy vehicles, in particular, are showing very little growth. This is in contrast to how electric vehicles are performing in Europe and North America. Electronic heavy vehicles are gaining momentum in many European countries like Sweden. For these reasons, stock trading experts feel that investing in the 2-wheeler segment may have more potential, at least in the short run.
However, experts also agree that the switch to heavy electronic vehicles might take time but will come eventually. When it finally arrives, investors could see strong growth in this segment. For investors willing to take moderate risk, the electric heavy vehicle sector is an interesting one to watch.
With the government targeting a 100% transition to electric vehicles by 2030, the sector has immense promise. However, most analysts agree that the goal is too ambitious. At the same time, even reaching halfway through the goal would mean a paradigm shift in the Indian automobile industry. Stock trading platforms are showing a growing demand for electric vehicle investment options.
Indian EV sector - where it stands currently
While there is no doubt about the immense potential of the EV sector, we must also acknowledge how and where it stands at present. The sector is still at a nascent stage. Huge infrastructural developments need to come up in order to boost development and innovation. Another important factor is making Indian roads electric vehicle-friendly. With a lack of charging stations and service centers, many people are skeptical of making the switch.
There is also a need for change in the consumer mindset. Many unaware consumers do not yet understand the full potential of electric vehicles. There is a general perception of electric vehicles being less functional than combustion vehicles. It is in part validated by the lightweight, affordable electric 2-wheelers made for urban commutes. As powerful batteries and motors come into play, this perception is set to change. Once the consumer mindset around electric vehicles changes, the sector could grow rapidly. As of now, we must admit that there is still a lot to do to boost growth in the sector.
Conclusion
The electric vehicle sector holds immense potential, but there are several hurdles to a smooth transition. While governmental policies are backing the sector more than ever, the general opinion around the sector needs to change. However, growing fuel prices are forcing many people to make the switch, even if it's not a 100% transition.
If you are looking for sectors that may show long term potential, the EV sector is one to keep an eye on. As we see more investment in electric vehicle technologies, we can expect a bright future for the sector.
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