Government has changed Staff Car Policy for Officers, EV made first choice

The Government of India has revised the price limits for purchasing staff cars by Ministries and Departments. Under the revised guidelines, government departments can now purchase electric vehicles (EVs) with a Net Dealer Price (NDP) of up to ₹20 lakh, while the maximum price limit for petrol, diesel and hybrid vehicles has been fixed at ₹10 lakh.

The Department of Expenditure, under the Ministry of Finance, issued an Office Memorandum dated November 10, 2026, announcing these changes. The new instructions are aimed at promoting electric mobility, reducing dependence on fossil fuels and taking into account the prevailing market prices and overall lifecycle costs of vehicles.

New Price Limits for Government Staff Cars

As per the revised instructions, the NDP ceiling for purchasing staff cars by Central Government Ministries and Departments will be as follows:

This means that the price limit for electric staff cars is now twice the limit applicable to conventional petrol, diesel and hybrid vehicles.

Electric Vehicles to Be the First Choice for Government Departments

The government has made electric vehicles the default and preferred choice for purchasing staff cars. Ministries and Departments are expected to procure electric vehicles whenever their existing petrol or diesel staff cars are condemned or replaced.

The revised policy is intended to encourage the use of electric vehicles in government offices and reduce the country’s dependence on fossil fuels.

Permission Required to Purchase Petrol or Diesel Vehicles

The government has also clarified that Ministries and Departments cannot ordinarily choose petrol, diesel or other internal combustion engine (ICE) vehicles instead of electric vehicles.

If a Ministry or Department believes that purchasing or using an electric vehicle is not practical, it will have to submit a properly justified proposal to the Department of Expenditure seeking relaxation.

Such proposals can be referred to the Department of Expenditure only after obtaining the approval of the Secretary of the concerned Administrative Ministry or Department and the concurrence of the Financial Adviser. The Department of Expenditure will examine such requests on a case-by-case basis.

Hiring of Electric Vehicles Will Continue to Be Mandatory

The revised memorandum has also reiterated the earlier instructions issued on September 1, 2022, regarding the hiring of electric vehicles by Ministries and Departments.

All Ministries and Departments will continue to follow the existing instructions mandating the hiring of electric vehicles.

If a department considers it necessary to hire a petrol or diesel vehicle instead, it will have to seek relaxation from the Department of Expenditure. The proposal must be properly justified and submitted with the approval of the Secretary of the concerned Administrative Ministry or Department and the concurrence of the Financial Adviser.

Reference to Earlier Government Order

The latest memorandum partially modifies the earlier Office Memorandum No. 18(23)/E.Coord-2021 dated September 1, 2022, which prescribed guidelines for the procurement and hiring of staff cars by Ministries and Departments of the Government of India.

With the latest changes, the government has increased the purchase price ceiling for electric staff cars to ₹20 lakh and fixed a lower ceiling of ₹10 lakh for petrol, diesel and hybrid vehicles. It has also reinforced its policy of making electric vehicles the preferred option for both procurement and hiring.