While the new electric vehicles policy will boost domestic auto component makers, brokerages see no risks for the likes of Tata Motors Ltd. and Mahindra & Mahindra Ltd. for the time being.

The new policy does not make a case for the competition for current models to increase. However, it does make the competitive landscape tougher for forthcoming electric cars from Indian original equipment manufacturers, Citi Research said in a report dated March 17.

From the entry of the likes of Tesla, domestic auto component makers like Sona Comstar and Motherson Sumi Wiring India Ltd. stand to gain. The policy will promote investments in the electric vehicle auto components ecosystem and charging infrastructure, according to Nomura Research.

Last week, the India government announced a new EV policy that’s aimed at attracting global players to make and sell electric cars in India.

With the government cutting the incentives for the electric two-wheelers, Jefferies India Pvt. sees prices rising up to Rs 12,000. It said policymakers prefer incentives for manufacturing/capability over demand creation.

Higher subsidies boosted EV sales from 0.4% in financial year 2021 to 5% in the second half of the last fiscal, Jefferies said in a report on March 17. “Two-wheeler demand continues to shift towards EV at gradual pace.”