CNG Autos to Disappear from Delhi Roads, Electric Powertrains to Become Mandatory

The latest electric vehicle (EV) policy proposed by the Delhi Transport Department has sent shockwaves through not just automobile manufacturers (OEMs) but also among residents of the National Capital Region (NCR). The policy introduces a range of measures that, if implemented, could bring major disruptions for both businesses and consumers.

One of the key highlights of the policy is the phasing out of CNG autos. As per the new rules, no new CNG three-wheelers will be registered in Delhi after August 15, 2024. Additionally, existing CNG autos older than ten years will need to be retrofitted with an electric powertrain, which is expected to cause significant logistical challenges for the three-wheeler market.

However, the most debated provision is the one that proposes a ban on registration of any petrol or CNG-powered two-wheelers in Delhi after August 15, 2025. This decision is being viewed by many as rushed and poorly timed, especially considering that global trends indicate a stagnation in EV demand.

According to the recently released “2025 Global Automotive Consumer Study” by Deloitte India, consumer interest in fully battery electric vehicles (BEVs) has dropped from 10% in 2024 to 8% in 2025. This raises the question – will Delhi’s EV Policy 2.0 bring solutions or simply cause chaos?

Rajat Mahajan, Partner and Auto Sector Leader at Deloitte India, commented, “Yes, it will be disruptive in the short term. But large-scale adoption always comes with a certain degree of disruption. In China, for instance, one of the key drivers for EV growth in the two-wheeler segment was a blanket ban on motorcycles, followed by incentives and infrastructure development.” He added that if Delhi’s EV policy sustains, other states may replicate similar models, potentially bringing a transformative shift to the Indian automotive industry.

However, experts also emphasize that EV growth will be impossible without strong supporting infrastructure, especially around batteries – the core component of any BEV. Developing a robust ecosystem for charging, recycling, and safe disposal of batteries is critical for the long-term success of the EV market.

Mahajan pointed out, “If a recycled battery can be offered at half or even less the cost of a new battery, it opens up a great business opportunity. Vehicle ownership cycles in India have dropped to about 4.5–5 years. If a recycled battery can cover that span affordably, it becomes a win-win.”

He further noted that EV market penetration across all segments in India currently stands at just 2.5%, but once it hits double digits, investment and focus in the EV space will increase significantly. Europe’s battery recycling industry is expected to reach $100 billion by 2035, and India too holds immense potential in this domain.