Government Pushes for Electric Vehicles as Default Choice for Staff Cars

In a groundbreaking initiative, the Finance Ministry has declared electric vehicles (EVs) as the default choice for government staff cars across all central ministries and departments. This new directive, effective immediately, raises the procurement price limit for EVs while setting a lower cap for traditional internal combustion engine vehicles. The move aims to promote electric mobility and reduce dependence on fossil fuels. Ministries must now prioritize EVs when replacing existing vehicles, with exceptions requiring justified proposals. This policy aligns with previous guidelines mandating the hiring of electric vehicles, reinforcing the government's commitment to sustainability.

By Narendra Chaudhary Nov 11, 2026, 18:15 IST

New Directive from the Finance Ministry

In a significant move, the Finance Ministry has announced that electric vehicles (EVs) will now be the 'default and preferred choice' for government staff cars across all central ministries and departments, effective immediately.

This directive, issued by the Department of Expenditure, has raised the maximum dealer price limit for EV procurement to Rs 20 lakh, while the cap for internal combustion engine (ICE) vehicles, including petrol, diesel, and hybrid models, is set at Rs 10 lakh.

The initiative aims to encourage electric mobility, lessen reliance on fossil fuels, and consider current market prices and the lifecycle costs of vehicles.

The order specifies that ministries and departments should generally opt for EVs when replacing or condemning their existing ICE vehicles. EVs are now the standard choice for procurement.

If a ministry or department finds it impractical to procure EVs and wishes to acquire an ICE vehicle instead, they must submit a justified proposal to the Department of Expenditure for case-by-case consideration. This proposal should be approved by the Secretary of the respective ministry and concurred by the Financial Adviser.

Furthermore, all ministries and departments are required to follow the guidelines issued by the Department of Expenditure on September 1, 2022, which mandates the hiring of electric vehicles.

In instances where hiring ICE vehicles is deemed necessary, a justified proposal must also be submitted to the Department of Expenditure for relaxation, with the necessary approvals.

All other regulations regarding the entitlement, procurement, and hiring of vehicles, as outlined in the memorandum dated September 1, 2022, will remain unchanged. The procurement process will continue to adhere to the General Financial Rules (GFR), 2017, as amended.