End of petrol dominance? EV presence in India to rise to 36% by 2035, says Japanese research firm

The EV penetration in India stood at 8 per cent in 2025, while CNG was at 6 per cent and hybrid EV at 2 per cent. Petrol and diesel, with over 80 per cent penetration, remain the dominant power train for mobility in India.

Satake said that the three policy-level drivers that dominate the Indian automotive landscape were energy security, import dependency, and carbon emissions.

By 2050 India’s oil consumption could reach 8.2 million barrels per day “which is a huge number” (from 5.5 million barrels per day in 2024), automobile component imports increased 3 per cent in the 2024 fiscal year to almost 21 billion US dollars, and India is the third largest CO2 emitter with transportation accounting for 14 per cent of the global emissions, he said.

“These constraints push policy makers, OEMs and consumers towards diversified low-carbon power trains,” Satake said. Biofuels will also be a key factor in the economic growth of India through the reduction of oil imports and reducing carbon emissions, the NRI director said.

“Biofuels can reduce oil imports of USD 4 billion a year and promote energy security when E20 (20 per cent ethanol-blended fuel) is fully adopted, and the carbon emissions can reduce hydrocarbons and CO2 emissions by roughly 20 per cent,” Satake said.

“Major OEM initiatives also reveal market traction for new power trains with, for example, Toyota demonstrating a strong hybrid flex fuel prototype that can run 100 per cent on ethanol while maintaining EV mode. Suzuki and National Dairy Development Board have signed MoUs to develop dung-based compressed biogas plants in Gujarat, targeting automotive-quality biogas fuel,” he said.

According to the NRI India director, the biofuel ecosystem represents a classic cycle economy that benefits the rural economy as well. “First step is agriculture waste will be utilised as biomass feedstock, which will boost rural economy and purchasing power of farmers,” he said, adding that this, in turn, will strengthen real markets for vehicles and formulate a local self-sustaining economy.

‘Reflects shift in how advanced and emerging economies collaborate’

The Japan India Mobility Summit 2026 was held for synergy between “Japan’s globally respected multi-pathway strategy aligns naturally with India’s expanding EV ecosystem, digital public infrastructure, and manufacturing ambitions”.

“Japan brings technology leadership, IP, quality system and India offers scale, cross advantages, abundant waste stock and market size,” Satake said.

“India’s mobility future is multi-faceted—a blend of EVs, hybrid CNG and bio fuels driven by energy security imperatives, import concerns and climate commitments. This is the right time to begin to accelerate,” Satake said.

The summit was organised by the Ministry of Economy, Trade and Industry of Japan, Japan External Trade Organization, New Energy and Industrial Technology Development Organization, along with the Niti Ayog of India.

“The Japan-India Mobility Summit 2026 represents more than bilateral engagement. It reflects a broader shift in how advanced and emerging economies collaborate in a decarbonizing world,” the organisers said.