India’s electric vehicle (EV) market has reached a significant milestone, surpassing one million registrations in the first half of the fiscal year 2026. According to the Economic Times, government data showed that total EV registrations in September were 1.82 lakh units, a 3% decrease from 1.88 lakh units in August. Despite this monthly slowdown, the overall growth trend remains steady, with second-quarter volumes increasing to 5.70 lakh units from 5.33 lakh units in the first quarter.
The cumulative registrations for the first half of the fiscal year 2026 reached 1.1 million units, marking a significant increase from 8.95 lakh units during the same period last year. However, the electric passenger vehicle (e-PV) category experienced a sharp decline, falling to 15,100 units in September from 18,290 units in August. Analysts attribute this decline to recent reductions in Goods and Services Tax (GST) on internal combustion engine (ICE) vehicles and hybrids, which have widened the price gap with electric models.
Puneet Gupta, Director at S&P Global Mobility, noted that the GST reductions have made ICE vehicles and hybrids more attractive to price-sensitive buyers, resulting in a decrease in EV penetration in the passenger vehicle segment from nearly 5% to about 4%. Poonam Upadhyay, Director at Crisil Ratings, emphasized the need for the industry to focus on charging infrastructure, affordable financing, and total cost-of-ownership awareness to sustain EV adoption.
In contrast, electric two-wheeler registrations remained steady at 1.04 lakh units, while e-three-wheeler volumes were slightly lower at 61,000 units in September. TVS Motor led two-wheeler sales with 22,491 units, followed by Bajaj Auto with 19,554 units. The coming months will be crucial in determining whether the September dip in passenger EV sales is temporary or a longer-term impact of tax policy changes. Industry watchers will be closely monitoring the market to see how it responds to these changes and whether the growth trend can be sustained.