India's electric vehicle (EV) market may be witnessing record sales, but the next phase of growth will depend less on subsidies and more on financing, localisation and charging infrastructure, according to the latest IESA e-Mobility FY2025–26 Report prepared by Customized Energy Solutions (CES).
Presented at India Energy Storage Week (IESW) 2026, the report outlines key priorities for original equipment manufacturers (OEMs), suppliers, investors and policymakers as the country's EV ecosystem matures.
For OEMs and suppliers, the report recommends preparing for a future with lower government incentives. It notes that the PM E-DRIVE subsidy for electric two-wheelers has already been halved and is scheduled to expire on July 31, 2026, arguing that manufacturers should develop products capable of competing on cost even without demand-side support.
CES also highlights that India's announced 76 GWh of battery capacity largely comprises battery pack assembly rather than cell manufacturing. It notes that the ACC-PLI scheme has delivered only 2.8 per cent of its 50 GWh target, underscoring the need to strengthen domestic capabilities in cell, cathode and electrolyte manufacturing.
Commercial EV Financing, Charging Reliability In Focus
The report identifies commercial EV financing as one of the sector's largest untapped opportunities. Citing an Asian Development Bank (ADB) estimate, it says Rs 45,000–55,000 crore in commercial EV financing will be required by 2026. However, buses and goods carriers continue to face financing challenges due to concerns around residual value and asset risk.
For policymakers, CES argues that the focus should move beyond the number of charging stations installed to their operational performance. The report notes that 18 per cent of charging stations are already non-operational and recommends measuring charging infrastructure through uptime and utilisation metrics. It also calls for a review of cell manufacturing incentives under the ACC-PLI scheme and renewed efforts to accelerate localisation across the EV supply chain.