Centre makes EVs the default staff car, sets ₹20 lakh price ceiling for electric models

Central government ministries and departments now have to pick electric cars when they replace their petrol or diesel staff cars. The Department of Expenditure, under the Ministry of Finance, issued an office memorandum on 10 November 2026 that makes EVs the default choice for official vehicles, effective immediately after approval from its secretary.

The money gap is the tell. Electric staff cars carry a net dealer price ceiling of ₹20 lakh, while petrol, diesel and hybrid models are capped at ₹10 lakh. The department said the revised limits reflect prevailing market prices and vehicle lifecycle costs, alongside the push for electric mobility.

Conventional cars are not banned outright. A department that wants one must argue that an EV isn't practical, then send a justified proposal to the Department of Expenditure for case-by-case relaxation. That pitch needs the sign-off of the secretary of the concerned administrative ministry or department and the concurrence of its financial adviser.

Hiring follows the same logic. The existing instruction that ministries hire electric vehicles stays in place, and departments that think a petrol, diesel or hybrid hire is necessary must seek relaxation the same way — justification, secretary approval, financial adviser concurrence. Everything else governing entitlement, procurement and hiring of staff cars is unchanged, with purchases still ruled by the General Financial Rules, 2017.

One thing the memorandum does not do is hand employees cash. The ₹20 lakh figure is a procurement ceiling for vehicles bought or hired for official use, not a car allowance, a loan facility or a personal EV subsidy. Mint also notes it is separate from the 8th Central Pay Commission's work on salaries, allowances and pensions — so for government staff, the practical change is which cars their departments buy, not what lands in their bank accounts.