The Delhi government’s proposed incentive scheme offering up to ₹1 lakh for scrapping old vehicles and switching to electric mobility could significantly accelerate the transition toward cleaner transport, particularly in the last-mile mobility segment, industry experts believe.
Under the proposed policy, owners of older Delhi-registered vehicles will be eligible for financial incentives if they scrap their vehicles at authorised facilities and purchase a new electric vehicle within six months. The incentives range from ₹10,000 for electric two-wheelers to ₹25,000 for electric three-wheelers and up to ₹1 lakh for electric cars, along with exemptions on road tax and registration fees for certain EV categories.
While the policy spans multiple vehicle segments, industry stakeholders say electric three-wheelers (E3Ws) could benefit the most due to their widespread use in passenger transport and urban cargo mobility.
India’s electric three-wheeler market has emerged as one of the fastest-growing EV segments in the country, accounting for a significant share of overall EV adoption. The segment plays a crucial role in last-mile connectivity, small logistics operations and urban mobility, making it central to India’s transition toward sustainable transport.
Ayush Lohia, CEO, Youdha, said scrappage-linked incentives can accelerate the replacement of older, high-emission vehicles with electric alternatives, particularly in the commercial mobility segment.
“Electric three-wheelers represent one of the most practical pathways for accelerating EV adoption in India’s urban transport ecosystem. Incentive-linked scrappage policies reduce the upfront cost barrier for drivers and small fleet operators who depend on these vehicles for daily livelihoods,” Lohia said.
He added that the economic case for electric three-wheelers is already strong due to significantly lower running costs compared with internal combustion vehicles.
“For commercial operators, the transition to electric mobility is not only about environmental benefits but also about long-term operational savings. When supported by policy incentives, the shift from older vehicles to electric alternatives can happen much faster,” he said.
Industry observers believe that policies encouraging the retirement of older vehicles could also help reduce urban pollution while modernising India’s large base of ageing auto-rickshaws and small cargo vehicles.
As cities continue to explore ways to reduce emissions and improve air quality, scrappage-linked EV incentives could play a pivotal role in accelerating the electrification of India’s last-mile transport ecosystem.
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