According to DoC, the country has imported electric four-wheelers worth Rs 4.92 billion in the first six months of this fiscal compared to Rs 3.24 billion during the same period in the last fiscal year.
Of the total imported vehicles during the first six months of the current fiscal year, 1,708 were equipped with electric motors up to 100KW. The imports of such EVs stood at 396 units in the first six months of the last fiscal year. The change in the tax arrangements on EVs by the government in the current fiscal year's budget has helped the market of 100kW EVs to boom. In the budget for FY2022/23, the then finance minister Janardan Sharma levied excise duty on top of the existing customs duty on EVs above 100 kW capacity. The government has imposed a 30 percent excise duty on vehicles with 100-200 kW motors. Similarly, a 45 percent excise duty has been imposed on the imports of vehicles with electric motors of 201-300 kW capacity and a 60 percent excise duty on vehicles with more than 300 KW motor capacity. The changes in tax structure have made EVs above 100 kW costlier in the market. Official statistics show the imports of EVs up to 100 kW have gone up by 331.31 percent in the first six months while imports of EVs above 100 kW have declined significantly. The biggest growth has been seen in the motorcycle/scooter segment. The imports of electric two-wheelers have increased by a whopping 243.80 percent in the current fiscal year. Nepal has imported 5,133 units of electric motorcycles/scooters in the first six months of the current fiscal compared to 1,493 units during the same period of the last fiscal. The micro-bus segments also grew by 88.09 percent. Nepal has imported 79 electric micro-buses in the first six months of the current fiscal year. Amid declining foreign exchange reserves which created fear that the country would head in the direction of Sri Lanka, the government imposed a complete ban on ICE vehicles along with a number of other goods starting from April 2022. Though measures to control the import of fuel-based vehicles helped to increase the imports of electric vehicles, the government’s policy towards promoting electric vehicles has remained inconsistent. Nepal’s second enhanced Nationally Determined Contributions (NDCs) submitted at the United Nations targets to achieve a 20 percent share of EVs in the public transport category by 2025. In 2018, the government proposed to turn at least 20 percent of public vehicles into electric buses by 2020, in a plan based on Nepal’s commitments at the 2015 UN climate conference in Paris. Yet the plan hasn’t moved an inch in the past five years. While presenting the budget for the fiscal year 2021/22, the then Finance Minister Bishnu Paudel had said that Nepal plans to shift from light vehicles that run on petroleum products to electric ones by 2031 and announced a strategic plan to lower fuel imports and the concomitant pollution. However, Nepal has taken only a baby step towards the electrification of the country’s transport system with an insignificant number of vehicles operating in the country being electric. Besides inconsistent taxation policy, the lack of adequate charging stations has also delayed the widespread adaptation of electric vehicles in the country. The Nepal Electricity Authority (NEA) said it has almost completed installing 50 charging stations. According to an official of NEA, as many as 25 charging stations have already come into operation while the installation of 30 has recently been completed and five are in the process of completion. Even the private sector is also coming up with new charging station plants. However, automobile dealers say that it is not enough to speed up the transition process.
