Finally, certain high-end e-cycle parts pedal their way into PLI scheme

In a major boost, certain high-end parts of e-cycles have finally been brought under the ambit of the production linked incentive (PLI) scheme that will help the industry increase manufacturing, generate employment and attract investments.

Pankaj Munjal, owner and CMD of Hero Cycles, said that during a meeting with industry minister Piyush Goyal in Delhi on Saturday, the latter confirmed that certain high-end e-cycle parts will be part of the PLI scheme.

The government had introduced the PLI scheme which covers 14 significant sectors till now. It was a long-pending demand of the cycle industry to include e-cycles under its ambit.

Finance Minister, Nirmala Sitharaman had in March 2020, announced an outlay of ₹ 1.97 Lakh crore for the PLI schemes across 14 key sectors, to create national manufacturing champions and 60 lakh new jobs, and an additional production of ₹ 30 lakh crore during the next 5 years. The scheme was introduced to promote indigenous production and reduce dependence on a single market or geographical region.

Munjal said that with this, certain high-end parts used in e-cycles will be part of the PLI and the sector will attract investments.

“The prices of such parts will come down by as much as 25% and export competitiveness will improve. E-cycles is a $ 52 billion market and the announcement will also boost 5,000 hi tech jobs in mechatronics,” said Munjal.

Munjal has, in the past, lamented how India is losing out on a huge opportunity to build a ₹ 20,000 crore electric bicycle export market here.

“The demand for e-bicycle is booming in Europe, and they prefer Indian bicycles over Chinese,” he said.

According to Onkar Singh Pahwa, owner and CMD of Avon cycles, linking PLI scheme to e-cycles will attract huge investments.

“Right now, we are totally dependent on China for some high-end parts used in e-cycles which are not manufactured in India. If PLI is extended to e-cycles, it is sure to attract investments and reduce our dependency on imports of such parts,” he said.

An ambitious state-of-the-art project of the Punjab government for an e-cycle valley in Ludhiana’s Dhanansu village was mooted in 2016 and the project was formally inaugurated in 2021 when Hero e-cycles factory, on 50 acres of land, started manufacturing there.

While 120 hi-tech e-cycles on a daily basis are being manufactured here currently, all of these are being exported to Germany, UK and the US. Besides, Hero e-cycles, Spur Technologies (Hero’s another group of companies) and Hero Yamaha Mitsui joint venture has also been set up at the Dhanansu valley.

However, the Dhanansu e-cycle valley project has failed to get the required impetus due to low demand of e-cycles in India and high costs being a dampener. With the scheme now being extended to e-cycles, it is expected that the project will attract more investors.