Why India is relaxing EV motor parts import rules
India's plan to make more electric vehicle (EV) parts locally just ran into a speed bump: there's a shortage of rare earth magnets, which are crucial for EV motors.
To keep things moving, the government is now letting makers of e-trucks and e-buses import certain motor parts—without losing out on benefits from the ₹10,900-crore PM E-Drive scheme.
This quick fix, announced at the end of September 2025, is mainly to deal with China tightening exports and shaking up India's manufacturing plans.
What about long-term goals?
The Phased Manufacturing Programme (PMP), part of the PM E-Drive scheme, was designed to boost homegrown production by requiring local sourcing of 18 key components.
With this new flexibility on imports due to the magnet crunch, India still expects manufacturers to start assembling traction motors with parts such as magnets and cables locally by March 2026 for N2 category trucks.
The message: short-term challenges won't derail India's bigger goal—a self-reliant and globally competitive EV industry in the coming years.