Delhi EV Policy 2026-30 Draft: Key Incentives

The Government of NCT of Delhi released the Draft Delhi Electric Vehicle Policy 2026-2030 on 11 April 2026, opening a 30-day public feedback window that closes on 11 May 2026. The draft replaces the earlier 2020 policy and marks a structural shift: direct purchase subsidies for electric cars are gone, but in their place is a Rs. 1 Lakh scrappage-linked bonus for the first 1,00,000 buyers who replace a BS-IV or earlier petrol or diesel car with an EV priced up to Rs. 30 Lakh. Road tax and registration fee waivers for EVs continue at 100% till March 2030, and from 1 January 2027 the city will block fresh registrations of internal combustion 3-wheelers and auto-rickshaws altogether. Below is a clear, number-by-number breakdown for Delhi car buyers, used car sellers and the NCR commuter belt.

What Delhi's Draft EV Policy Actually Proposes

The Draft Delhi EV Policy 2026-2030 was issued by the Delhi Transport Department on 11 April 2026, with a 30-day feedback window that closes on 11 May 2026. The Delhi Government has invited written representations from manufacturers, fleet operators, RWAs, commuter bodies and ordinary residents. After the feedback window closes, the Transport Department is expected to finalise the policy and publish a gazette notification — historically this has taken 4-8 weeks after feedback closure, which puts a likely final notification somewhere between June and July 2026.

The draft covers all four major vehicle categories — electric 2-wheelers, 3-wheelers, cars and commercial vehicles — but the incentive structure differs sharply between them. 2W and 3W buyers get direct per-kWh subsidies on a declining 3-year schedule. Car buyers do not get a direct purchase subsidy at all; instead, they get a Rs. 1 Lakh cash bonus if they scrap a BS-IV or earlier ICE car and buy an EV priced up to Rs. 30 Lakh. Everyone under the Rs. 30 Lakh price ceiling also gets a full waiver of road tax and registration fee till March 2030.

Crucially, the policy is still a draft. Provisions — including the Rs. 30 Lakh cap, the 1,00,000-applicant ceiling on the scrappage bonus, and the 2027 3-wheeler ICE registration ban — could all change after feedback. Readers should treat the numbers below as firm directional intent rather than gazette-notified rules.

Electric Cars — The Scrappage Cash Route

Here is the most debated provision in the entire draft: there is no direct purchase subsidy for electric cars. The Delhi Government has walked away from the model used by states like Maharashtra, Gujarat and Tamil Nadu, which offer up-front per-kWh subsidies on new EV cars. Instead, Delhi is offering a single, one-shot Rs. 1 Lakh bonus — but only if you scrap an older car to get it.

The mechanics are straightforward. If you are a Delhi resident and you surrender a BS-IV or earlier petrol or diesel car at a MoRTH-notified Registered Vehicle Scrapping Facility (RVSF), you get a Certificate of Deposit (CoD) under the existing Vehicle Scrappage Policy. If you then buy a new electric car priced up to Rs. 30 Lakh ex-showroom and register it in Delhi, you become eligible for the Rs. 1,00,000 scrappage-linked EV incentive. The benefit is capped at the first 1,00,000 applicants on a first-come-first-served basis from the date of notification.

Why no direct car subsidy? The Delhi Government's reasoning, signalled in the draft's preamble, is twofold. First, the Indian car market now has a healthy spread of sub-Rs. 15 Lakh EVs — the Tata Punch.ev, Tata Tiago.ev, MG Windsor EV, Hyundai Exter EV (upcoming) and Mahindra BE.05 — so state subsidies are no longer needed to make the first rung affordable. Second, a scrappage-linked incentive does double duty: it puts an EV on Delhi's roads and it takes a BS-IV polluter off them, which is closer aligned to the city's primary problem (air quality) than an unconditional subsidy is.

The Rs. 30 Lakh ex-showroom cap is designed to keep the benefit focused on mass-market EVs. On a Rs. 20 Lakh EV, a Rs. 1 Lakh bonus is a 5% effective discount. On a Rs. 10 Lakh EV, it is a 10% discount. Combined with the road tax waiver discussed below, the overall reduction in on-road price can be much larger than the headline Rs. 1 Lakh figure suggests — especially for lower-priced models where the percentage impact is biggest.

Road Tax & Registration — 100% Exemption Details

The second big benefit, often overlooked in coverage that focuses only on the Rs. 1 Lakh bonus, is a complete waiver of road tax and registration fees for eligible EVs. This provision is not gated by scrappage — it applies to every new EV priced up to Rs. 30 Lakh ex-showroom, whether you scrap a car or not.

Delhi currently levies road tax on ICE cars at roughly 4% to 10% of ex-showroom price, depending on the price slab. For passenger cars priced below Rs. 6 Lakh, the tax is around 4%; between Rs. 6 Lakh and Rs. 10 Lakh it climbs to about 7%; and above Rs. 10 Lakh it sits at the top end of the scale. Registration fees and the Motor Vehicle Registration Charge add another Rs. 1,500-5,000 depending on category.

On a Rs. 20 Lakh EV, a full road tax and registration waiver works out to roughly Rs. 1.6-2 Lakh in savings compared to the on-road cost of an equivalent petrol or diesel car. That is often larger than the Rs. 1 Lakh scrappage bonus itself — and, crucially, it stacks on top of it for buyers who qualify for both. For a buyer scrapping a BS-IV car and buying a Rs. 20 Lakh EV, the combined Delhi benefit can touch Rs. 2.6-3 Lakh, before counting central benefits under schemes like PM E-Drive or lower GST on EVs.

The waiver is not open-ended. The draft specifies a sunset of March 2030, aligned with the policy's five-year validity. EVs registered after that date will face standard road tax rates unless the policy is renewed. This creates a clear four-year buying window — and is itself a reason for Delhi buyers sitting on the fence to finalise their EV purchase inside this policy period.

Electric 2-Wheelers and 3-Wheelers — The Real Focus

While the car provisions grab headlines, the draft is arguably even more aggressive on two-wheelers and three-wheelers — the vehicle categories that dominate Delhi's registered fleet and its tailpipe emissions. The incentive structure here is a classic declining schedule, meant to reward early adopters and taper off as the category matures.

For electric 2-wheelers priced up to Rs. 2.25 Lakh, the draft proposes a per-kWh incentive of Rs. 10,000 in Year 1, capped at Rs. 30,000 per vehicle. The cap then steps down to Rs. 20,000 in Year 2 and Rs. 10,000 in Year 3. This is directly aimed at the commuter segment — Ola, Ather, TVS iQube, Bajaj Chetak and Hero Vida — where price sensitivity is highest and the gap to petrol scooters is narrowest.

For electric 3-wheelers, including auto-rickshaws and small goods carriers, the incentive is steeper: Rs. 50,000 in Year 1, Rs. 40,000 in Year 2, and Rs. 30,000 in Year 3. This reflects the commercial use case — auto drivers and fleet operators need a sharper payback calculation, and Rs. 50,000 is close to a full year of fuel savings for a city taxi.

The sharpest 3-wheeler provision, however, is not the incentive itself — it is the 1 January 2027 cut-off. From that date, the draft states that only electric 3-wheelers and auto-rickshaws will be allowed to register in Delhi. Fresh registrations of CNG or petrol 3-wheelers will be blocked outright. Existing ICE 3-wheelers can continue to operate till their permit expiry under the current rules, but the replacement cycle will force the fleet to electrify. For Delhi's auto-rickshaw fleet (roughly 90,000-plus permitted units) and tens of thousands of goods 3-wheelers, this is the most far-reaching change in the entire policy.

What Changes for Delhi Car Buyers — With and Without Scrappage Bonus

To see how the policy plays out in practice, consider a family buying a Rs. 20 Lakh EV in Delhi. There are three scenarios: they scrap a BS-IV car and claim the Rs. 1 Lakh bonus; they buy without scrappage; or they buy an equivalent petrol/diesel SUV and pay full road tax. Using typical numbers, the comparison looks like this.

Two observations stand out. First, even without the scrappage bonus, an EV buyer in Delhi saves close to Rs. 1.9 Lakh against the equivalent ICE SUV — purely from the 100% road tax and registration waiver. That is a substantial benefit and applies to every single EV buyer under the Rs. 30 Lakh cap. Second, buyers who do qualify for the scrappage bonus push total savings past Rs. 2.9 Lakh, which materially narrows the list price gap between EVs and comparable ICE cars.

What This Means for Used Car Buyers and Sellers

A scrappage-linked policy of this scale has second-order effects on the used car market that Delhi and NCR sellers should plan around. The 1,00,000-applicant cap in particular introduces a time-limited arbitrage that rewards speed.

BS-IV cars in Delhi gain residual value. For years, BS-IV petrol and diesel cars in Delhi have traded at a discount because of NGT age limits and resale fatigue. Under the new draft, a BS-IV car scrapped at an RVSF is suddenly worth Rs. 1 Lakh of EV-purchase credit — which is often more than its open-market resale value. Owners of older used cars in Delhi planning to upgrade to an EV should do the maths on both routes: selling the car used versus scrapping it for the CoD and claiming the bonus.

Used EV demand in Delhi likely to surge. Buyers who miss the first-1,00,000 window, or who are priced out of the Rs. 30 Lakh ceiling, will look at the one-to-three-year-old EV market as a substitute. Expect a measurable price premium to develop between Delhi used EV listings and identical listings in other metros — Delhi buyers will be willing to pay more for an EV that already has the waived road tax advantage baked in. For sellers of EVs like the Tata Nexon EV, MG ZS EV, Tata Punch.ev and Mahindra XUV400 EV, this is a strong reason to list in Delhi rather than neighbouring cities.

Sellers of BS-IV cars should time listings carefully. Once the final policy is notified and the 1,00,000-applicant counter starts ticking, mass scrappage will reduce used BS-IV supply in Delhi sharply within a few months. Owners who want maximum residual value in the open market should consider listing before notification; owners who want the scrappage bonus should wait for the RVSF route to open. Our scrappage policy tips and Delhi-NCR pollution rules guide are useful for weighing the two paths.

NCR buyers can shop across the border. Residents of Gurugram, Faridabad, Ghaziabad and Noida do not get Delhi's specific incentives directly — road tax and scrappage rules are state-specific — but the NCR market is tightly linked. Expect some spillover: Delhi-registered used EVs travelling across the border may become a hunting ground for NCR buyers, while Haryana and UP-registered BS-IV cars will NOT qualify for Delhi's Rs. 1 Lakh bonus. Re-registration in Delhi is not a shortcut; the draft ties the benefit to Delhi-registered vehicles being scrapped.

Is the Rs. 30 Lakh Cap Fair?

The single most criticised provision in the draft is the Rs. 30 Lakh ex-showroom price ceiling on both the scrappage bonus and the road tax waiver. Industry commentators and segment analysts have pointed out that this effectively excludes the entire premium EV segment from any state support — a list that includes the Mercedes-Benz EQS and upcoming Mercedes CLA EV (both Rs. 55 Lakh and above), the BMW i4 and i7, the Audi e-tron range, the Porsche Taycan and luxury-oriented variants of Volvo, Kia and Hyundai EVs.

Defenders of the cap argue that luxury EV buyers do not need a taxpayer subsidy to make the purchase decision. Critics counter that the cap slows down adoption at exactly the segment where early adopters lead product availability and charging infrastructure investment. With the Delhi Government signalling that the Rs. 30 Lakh threshold is among the provisions being debated during feedback, this is one number that could plausibly move before notification — though any upward revision would almost certainly narrow rather than remove the cap.

For buyers currently shopping in the Rs. 25-35 Lakh EV bracket, the cap creates an unusually sharp pricing cliff. A Rs. 29.9 Lakh EV qualifies for the full Rs. 1 Lakh scrappage bonus and 100% road tax waiver — potentially worth Rs. 3 Lakh or more in combined savings. A Rs. 30.5 Lakh EV qualifies for none of it. This is a real variant-choice consideration for cars like the Mahindra XEV 9e, BYD Atto 3 long-range and Hyundai Kona EV, where optional extras can push list prices across the Rs. 30 Lakh threshold.

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