New Delhi, Nov 11 — Electric vehicles will be the 'default and preferred choice' for staff cars of central ministries and departments, the Finance Ministry has said in an office memorandum dated November 10, doubling the purchase ceiling for EVs to a net dealer price (NDP) of Rs 20 lakh while fixing it at Rs 10 lakh for petrol, diesel and hybrid cars.

Source: IANS via Hi India

The Hindu BusinessLine, in its independent report on the same memorandum, said ministries and departments 'shall ordinarily procure EVs at the time of condemnation/replacement of their existing ICE staff cars', quoting the Department of Expenditure order: 'EVs shall be the default and preferred choice for procurement.'

Source: The Hindu BusinessLine

What the order changes

The revised NDP ceilings — Rs 20 lakh for electric cars and Rs 10 lakh for internal combustion engine (ICE) vehicles — replace the single Rs 6 lakh ceiling set in the 2022 instructions on procurement and hiring of cars by ministries and departments. The ministry said the revision accounts for prevailing market prices and vehicle lifecycle costs, and is aimed at promoting electric mobility and reducing dependence on fossil fuels.

The order does not ban conventional cars outright: a department that considers an EV impractical must send a justified proposal to the Department of Expenditure, with the approval of its secretary and the concurrence of its financial adviser, according to reports of the memorandum's terms.

Hiring rules stay, effect immediate

The ministry clarified that the September 1, 2022 instructions mandating the hiring of electric vehicles by government departments will continue to remain in force, and that all other conditions on entitlement, procurement and hiring of staff cars remain unchanged, with purchases governed by the General Financial Rules, 2017. The revised instructions have come into force with immediate effect.