Niti Aayog’s draft battery swapping policy for EVs explained – key recommendations and what it means

• Niti Aayog, the Indian government’s think tank, has come out with a draft battery swapping policy.
• Earlier this year, finance minister Nirmala Sitharaman had revealed that the government is working on this policy.
• Here’s everything you need to know about the draft battery swapping policy.

The Niti Aayog has come out with a draft battery swapping policy, proposing several incentives for electric vehicle (EV) makers to offer battery swapping options and for other companies to enter the battery-as-a-service business.

With electric vehicles now gaining more popularity in India thanks to the launch of several new electric scooters being launched over the last year, the Indian government’s goal of electrifying the transport system by 2030 has received a major boost.

Earlier during the budget announcement, Finance Minister Nirmala Sitharaman had revealed that the government is working on a battery swapping policy to reduce the cost of buying electric vehicles. This would also make it easy for buyers to quickly get a boost instead of waiting for their EVs to charge up.

What is battery swapping?

Battery swapping, as the name implies, allows EV owners to quickly remove their discharged battery and place a charged one.

This is similar to the older days of swapping batteries in phones – you could carry around a charged battery separately and subsequently, when the one in your phone runs out of juice, you could replace it with the charged one.


As far as EVs are concerned, battery swapping has been one of the business models of a few companies out there. It is usually used for two and three wheelers, since their batteries are smaller and easier to replace.

What is the battery-as-a-service business model?

The battery-as-a-service business model is one in which companies set up dedicated battery swapping stations. These stations maintain stocks of replaceable batteries which are charged and kept in the stations.


Customers who have compatible EVs can then come in and swap out their discharged batteries and have it replaced with the charged ones at these stations, for a subscription or a pay-as-you-go model.

Battery swapping allows EV owners to quickly get a boost without worrying about having a charger installed, or wait for the vehicle to charge up.

What are the key proposals in Niti Aayog’s draft battery swapping policy?

Some of the key proposals of Niti Aayog’s draft battery swapping policy:

1. Reduce the difference between tax rates on lithium ion batteries and electric vehicle supply equipment. Currently, batteries attract GST at 18%, while EV supply equipment attract GST at 5%.
2. Offer the incentives that EVs with fixed batteries get to EVs with swappable batteries.
3. Require state governments to ensure that public battery charging stations are eligible for power tariffs at concessional rates.
4. Ease the registration process for EVs sold without batteries or those with swappable batteries.
5. Assign a unique identification number to swappable batteries and battery charging stations.
6. Set up battery swapping stations at locations like retail fuel stations, public parking areas, malls, etc.

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