MHI Notified Guidelines for SPMEPCI Scheme to Promote Manufacturing of EV Passenger Cars

In June 2025, the Ministry of Heavy Industries (MHI) has notified detailed guidelines for the ‘Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI)’. The scheme aims to attract fresh investments from international Electric Vehicles (EVs) and position India as a global manufacturing hub for EVs.

• The SPMEPCI scheme, originally announced in March 2024, aligns with India’s goal to achieve net-zero emissions by 2070.
• The scheme will help in fostering sustainable mobility, driving economic growth, and mitigating environmental impact.

Key Guidelines for SPMEPCI:

i.Import Duty Concessions: As per the scheme, approved Electric Vehicle (EV) manufacturers will be allowed to import Completely Built-in Units (CBUs) of electric 4-wheelers  (e-4ws)with minimum Cost-Insurance-Freight (CIF) value of USD 35,000 at a reduced customs duty of 15% for a period of 5  years.

ii.Minimum Investment: Approved applicants must invest Rs.4,150 crore (USD 500 million) in establishing EV manufacturing facilities in India within three years of receiving approval from the MHI.

iii.Maximum number of e-4ws to be imported: The scheme has capped the maximum number of e-4ws to be imported at reduced customs duty at 8,000 units per year. It also allows unutilized annual imports to be carried over into the next year.

iv.Import duty concession limit: Also, the total duty foregone is required to be limited to either Rs 6,484 crore or committed investment of the applicant (minimum Rs 4150 crore), whichever is lower.

iv.Domestic Value Addition: It is mandatory for approved applicants to achieve minimum Domestic Value Addition (DVA) of 25% within 3 years and 50% within 5 years from the date of issuance of approval letter by MHI or Project Management Agency (PMA).

• The DVA of the eligible product will be evaluated by MHI-approved testing agencies as required under the scheme, aligned with Product Linked Incentive Scheme for Automobile and Auto Component (PLI Auto Scheme).

v.Eligible Expenditure: Investment in new plant, machinery, Research & Development (R&D) facilities, and a capped percentage of building (not more than 10% of committed investment) and charging infrastructure (maximum 5%)will be considered as expenditure. Land cost will be excluded.

• It is mandatory to make investment for local manufacturing of eligible products, with specific guidelines for brownfield projects.

vi.Bank Guarantee: A bank guarantee from Scheduled Commercial Bank(SCB) in India, equivalent to the total duty foregone or Rs 4,150 crore, whichever is higher, must be submitted during the scheme period to ensure compliance with investment and DVA commitments.

• Also, the Bank Guarantee should be valid for the entire time period of the scheme.

vii.Application Process: As per MHI, the application window will remain active for at least 120 days (or more), MHI have option to re-open it until March 15, 2026.

• The applicant will pay a non-refundable application fee of Rs 5 lakh, while filing the application form.

viii.Eligibility Criteria: Only those applicant companies will be eligible for the scheme, which have a minimum global automotive revenue of Rs 10,000 crore and a fixed asset base of minimum Rs 3,000 crore, based on latest audited financials.

About Ministry of Heavy Industries (MHI):
Union Minister- Haradanahalli Devegowda (HD) Kumaraswamy (Constituency- Mandya, Karnataka)
Minister of State (MoS)- Bhupathi Raju Srinivasa Varma (Constituency- Narasapuram, Andhra Pradesh, AP)