New Delhi, Nov 2026 : The Finance Ministry has made electric vehicles (EVs) the default and preferred option for procuring government staff cars across all central ministries and departments, with the new directive taking effect immediately.
The notification, issued by the Department of Expenditure, has doubled the price ceiling for EV procurement to Rs 20 lakh in net dealer price. In comparison, the ceiling for internal combustion engine (ICE) vehicles, including petrol, diesel and hybrid cars, has been fixed at Rs 10 lakh.
The move is aimed at promoting electric mobility, reducing dependence on fossil fuels and taking into account prevailing vehicle prices and lifecycle costs.
According to the office order, ministries and departments will ordinarily be required to procure EVs whenever their existing ICE staff cars are condemned or due for replacement.
“EVs shall be the default and preferred choice for procurement,” the notification stated.
However, the government has provided for exceptions where ministries or departments consider the procurement or deployment of electric vehicles impractical. In such cases, they will have to submit a proposal with proper justification to the Department of Expenditure, seeking relaxation on a case-by-case basis.
Such proposals must be approved by the Secretary of the concerned administrative ministry or department and have the concurrence of the Financial Adviser.
The directive also reiterates the government's policy of promoting electric vehicles through the hiring of cars for official use. Ministries and departments will continue to follow the instructions issued by the Department of Expenditure on September 1, 2022, which mandated the hiring of electric vehicles.
If a ministry or department considers hiring an ICE vehicle necessary, it will similarly have to seek an exemption from the Department of Expenditure through a duly justified proposal. Approval from the administrative ministry's or department's Secretary and concurrence of the Financial Adviser will be required.
The Finance Ministry clarified that all other terms and conditions governing the entitlement, procurement and hiring of government cars, as laid down in the September 1, 2022 office memorandum and subsequent instructions, will remain unchanged.
The procurement process will also continue to be governed by the provisions of the General Financial Rules (GFR), 2017, as amended from time to time.
The latest order marks a further step in the Centre's efforts to expand the use of electric vehicles in government operations and encourage a shift away from conventional fuel-powered transport.
