Central Government Employees: Electric Cars to Become the Preferred Choice for Official Use; ₹20 Lakh Purchase Limit

The Union Finance Ministry has directed central government ministries and departments to make electric vehicles (EVs) the default and preferred choice when purchasing official staff cars. The revised guidelines aim to promote electric mobility, reduce dependence on imported fossil fuels and lower carbon emissions.

According to an Office Memorandum issued by the Department of Expenditure on November 10, 2026, ministries and departments should ordinarily purchase electric cars when their existing petrol or diesel staff cars are replaced or withdrawn from service. The revised instructions have come into effect immediately.

Electric Car Purchase Limit Fixed at ₹20 Lakh

Under the revised guidelines, the maximum Net Dealer Price (NDP) for purchasing official vehicles has been fixed as follows:

The higher price ceiling for electric vehicles takes into account prevailing vehicle prices and their overall lifecycle costs, including operating and maintenance expenses.

Permission Required to Buy Petrol or Diesel Cars

The new guidelines do not completely prohibit conventional petrol, diesel or hybrid cars. However, if a ministry or department considers electric vehicles unsuitable for its requirements, it must submit a properly justified proposal to the Department of Expenditure.

The proposal must have the approval of the Secretary of the concerned ministry or department and the concurrence of its Financial Adviser. Permission will be considered on a case-by-case basis.

A similar approval process will apply if a department seeks to hire petrol, diesel or hybrid vehicles instead of electric vehicles.

Existing Electric Vehicle Hiring Rules to Continue

The Finance Ministry has also clarified that the existing September 1, 2022 instructions requiring government ministries and departments to hire electric vehicles will continue to remain in force.

Other rules relating to staff car eligibility, procurement and hiring will remain unchanged. Vehicle purchases will continue to follow the General Financial Rules, 2017, and subsequent amendments.

Why Is the Centre Promoting Electric Cars?

The government aims to reduce dependence on fossil fuels, encourage cleaner transportation and limit pollution from vehicles. Promoting electric vehicles for official use is part of its wider efforts to expand electric mobility across the country.

The revised policy will apply to staff car procurement by central government ministries and departments when existing conventional vehicles are replaced.