In a stark warning, a report from the esteemed financial think tank Carbon Tracker has raised concerns that India and other nations in the Global South could potentially transform into a dumping ground for used internal combustion engine (ICE) vehicles unless swift policy interventions are embraced to harness the advantages of the ongoing electric vehicle (EV) revolution.
The report, titled “Driving Change: How Electric Vehicles can rise in the Global South,” emphasizes the pivotal role of fully electric battery-powered vehicles (BEVs) in unlocking economic benefits for nations in Asia, Africa, and South America. It underscores that a strategic shift to BEVs has the potential to save these nations over $100 billion annually on fuel imports, reducing trade deficits, breaking the shackles of offshore refining dependency, and fostering job creation in burgeoning industries.
Ben Scott, Senior Automotive Analyst at Carbon Tracker, urges governments in the Global South to avoid entrenching themselves in the use of ICE vehicles, as such a trajectory would perpetuate reliance on fossil fuel imports. The report contends that nations can break free from this dependency by implementing policies supportive of the transition to BEVs, thereby initiating a positive cycle that encompasses accelerated electrification, a smart grid, and increased utilization of renewable energy, all contributing to a diminished dependence on foreign nations.
The report advocates several policy measures for governments to incentivize the adoption of BEVs and the development of a domestic BEV sector. These include imposing bans on the import of used cars, implementing age restrictions, setting emission standards, applying age-based excise duties, eliminating tariffs on electric cars, and supporting the domestic production, sales, and recycling of BEVs.
Ben Scott emphasizes the economic opportunities embedded in the BEV value chain, spanning mineral mining, manufacturing, sales, logistics, servicing, infrastructure development, and material recycling. Furthermore, the report urges caution against becoming a receptacle for outdated ICE vehicle models from the Global North, which could perpetuate fossil fuel dependency.
The call to action resonates against the backdrop of a rapidly evolving automotive landscape, with EVs emerging as a transformative force. As the Global South grapples with choices that could shape its economic trajectory, the report serves as a timely guide, urging a strategic embrace of electric mobility for a sustainable and economically vibrant future.