Delhi's EV Policy Is Here: A Guide To Subsidies, Tax Waivers And Bans

The rollout of Delhi's Electric Vehicles Policy 2026 has moved the capital's transition to electric mobility from policy to practice. With tax waivers, financial incentives and phased registration bans now part of the regulatory framework, the new rules will influence what consumers and businesses can buy over the coming years.

The Delhi Cabinet approved the landmark Delhi Electric Vehicle (EV) Policy 2026 to accelerate the capital's transition to zero-emission transport. Committing a budget of ₹15,000 crore over the next four years, the framework aims to transition the national capital towards electric mobility to combat severe vehicular pollution. Of this, around ₹7,000 crore will be spent on incentives, while another ₹8,000 crore has been earmarked for EV infrastructure development and tax concessions. The policy, introduced by Chief Minister Rekha Gupta, seeks to shift the city's approach from voluntary adoption to mandatory electrification, directly affecting the vehicles consumers and businesses can buy in the coming years.

What Is Delhi's EV Policy 2026?

The Delhi EV Policy 2026, often referred to as EV Policy 2.0, is a comprehensive regulatory roadmap that came into effect on July 1, 2026, and will remain in force until March 31, 2030. Designed to systematically phase out fossil fuel vehicle registrations across the capital, the policy imposes electrification mandates for specific sectors rather than merely offering subsidies.

According to Delhi Transport Commissioner Niharika Rai, the policy deliberately targets the vehicle categories that contribute most to the city's air pollution, specifically commercial fleets, two-wheelers and three-wheelers.

All newly hired or leased Delhi government vehicles and all new Delhi Transport Corporation (DTC) intra-city buses must now be fully electric. In addition, school operators are required to begin electrifying their bus fleets under a phased target system, with 10% of buses to be converted within two years, 20% within three years, and 30% by March 31, 2030.

When Will Petrol Two-Wheelers Be Phased Out?

The policy establishes fixed deadlines after which the Transport Department will stop registering specific categories of new internal combustion engine (ICE) vehicles.

From January 1, 2027, registrations of new petrol and CNG three-wheelers, including passenger auto-rickshaws, three-wheeled goods carriers and N1 category commercial goods carriers such as small trucks and delivery vans, will cease. Only electric variants will be eligible for registration.

From April 1, 2028, registrations of new petrol and CNG two-wheelers, including scooters and motorcycles, will also be discontinued. From that date onwards, consumers purchasing a new scooter or motorcycle in Delhi will have to buy an electric model.

Government officials have clarified that these restrictions apply only to new registrations and will not affect existing vehicles already on the road. Consumers who already own petrol-powered two-wheelers may continue to use them legally in Delhi, as the restriction applies solely to new vehicle registrations after the 2028 deadline.

What Incentives Are Available For EV Buyers?

Purchase Incentives

To ease the transition, the government has introduced a tiered purchase subsidy programme that rewards early adoption. Subsidy amounts will be reduced each year, encouraging consumers to switch sooner rather than later.

All financial incentives will be transferred directly to consumers through the Direct Benefit Transfer (DBT) system.

During the first year, buyers of electric two-wheelers priced below ₹2.25 lakh will receive up to ₹30,000. Electric three-wheelers, including auto-rickshaws, will receive ₹50,000, while electric N1 category goods vehicles will be eligible for up to ₹1 lakh.

In the second year, subsidies will be reduced to up to ₹20,000 for eligible electric two-wheelers, ₹40,000 for electric three-wheelers and ₹75,000 for electric N1 goods vehicles.

In the third year, buyers of eligible electric two-wheelers will receive up to ₹10,000, electric three-wheelers will receive ₹30,000 and electric N1 goods vehicles will be eligible for ₹50,000.

Scrapping Incentives

To encourage the removal of older, more polluting vehicles from circulation, the government has allocated more than ₹1,500 crore towards scrappage benefits.

Consumers who scrap BS-IV or older vehicles registered in Delhi and purchase an electric vehicle within six months of receiving a Certificate of Deposit (CoD) from an authorised scrapping facility will be eligible for additional incentives.

Eligible buyers of electric non-transport cars priced below ₹30 lakh can receive ₹1 lakh, limited to the first one lakh applicants. Electric N1 goods carriers qualify for ₹50,000, electric L5M three-wheelers for ₹25,000 and electric two-wheelers for ₹10,000.

Which Vehicles Qualify For Tax Exemptions?

The 2026 policy grants a 100% waiver on road tax and registration fees for eligible battery electric vehicles until March 31, 2030.

For passenger cars, the exemption applies only to battery electric vehicles with an ex-showroom price of ₹30 lakh or less. Electric passenger cars priced above ₹30 lakh will not qualify for the tax waiver.

In a departure from the initial draft proposals, the final Cabinet-approved policy excludes hybrid vehicles from receiving state support. While earlier drafts proposed a 50% tax concession for strong hybrids priced below ₹30 lakh, officials confirmed that the provision was removed to focus exclusively on zero-emission battery electric vehicles (BEVs). As a result, only pure battery electric vehicles qualify for state subsidies and tax exemptions.

To prevent misuse of these benefits, the policy introduces a mandatory three-year lock-in period, preventing beneficiaries from re-registering their vehicles in another state during that period.

How Many Charging Stations Is Delhi Planning?

To address range anxiety and support the expected increase in electric vehicles, the Delhi government has designated Delhi Transco Limited (DTL) as the nodal agency responsible for expanding the capital's public charging network.

DTL has been tasked with installing around 30,000 public EV charging points and battery-swapping stations across the city. Land has already been identified for the infrastructure, which will be jointly funded by the Delhi government and the Centre's PM E-Drive scheme.

The policy also streamlines installation by introducing a single-window clearance mechanism, managed by DTL, for private charging point operators. In addition, original equipment manufacturers (OEMs) are now required to install at least one public charging facility at every authorised dealership in the city. Each facility must provide a minimum of three charging points for two- and three-wheelers and two charging points for four-wheelers.