Budget 2026 Preview: How Policy Choices May Influence EV Growth

The upcoming Budget 2026 has generated curiosity among EV users as to how this budget will influence their buying decisions. Those buying EVs must be having questions about budget as 

Q. Does Budget 2026 promote EV Sales? 

Q. Does the upcoming budget reduce the prices for EV? 

Q. How much benefit charging infrastructure will get with the Budget 2026? 

India’s automotive landscape is not just limited to enhance its existence of electrification, but it is going through revolutionary advancements. As the union budget 2026 is near, the EV industry is expecting the budget to increase their incremental progress and exponential growth. 

While 2025 saw some record-breaking sales in electric two-wheeler and three-wheeler segments, however the majority of electric passenger car and commercial electric vehicles sales are heavily influenced by policy nuances. 

Let’s understand where the budget 2026 will be concentrated and whether it will be able to focus the shift toward broader infrastructure and rural income support. 

Strengthening the Foundation

The vision for 2026 will be crafted on the foundation of Fame-II and the PM E-DRIVE scheme as around 10,900 crore will be allocated further to enhance these schemes. While these schemes provided significant boost to the market, Budget 2026 is expected to be revolving toward Production Linked Incentives (PLI).

Thus projecting growth for battery cell manufacturing and optimising custom duties on critical materials, the government is aiming to marginally cut down domestic production costs, making India-manufactured EVs globally competitive. 

Overcoming Infrastructure and Credit Hurdles

DC Fast Charging Network: By setting up more than 26,000 charging stations by December 2025, the “range anxiety” fear is slowly eradicating, but still distribution remains uneven. The Budget 2026 could be focussing on improving the DC fast-charging networks specifically in Tier-II and Tier-3 cities. 

Green Soft Loans: On the other hand, Indian markets are facing a “credit gap” and shortages of credit in order to improve the market. We are expecting the introduction of Green Soft Loans or credit guarantee schemes in order to make EV financing accessible as traditional vehicle loans. 

Strategic Priorities for 2026

• Public Transport: An economic boost for 14,000+ e-buses via PPP models in order to reduce carbon emissions. 
• Tax Rationalisation: Potential GST adjustments on EV components in order to ensure price rationality with ICE vehicles. 
• Circular Economy: Addition of various new incentives and subsidies which will encourage battery recycling in order to reduce dependence on imported raw materials. 

Conclusion

Ultimately, Budget 2026 will be more focussed on policy certainty. Thus the government’s aim is to align the national goals and implement net-zero timelines. The government can ignite investor confidence, thus accelerating the EV growth in India with a more self-reliant future.