For years, New Delhi's residents have lived with an acrid smog that blankets the city in the cooler months and never fades completely.

As daylight gradually disappears, it gives way to a shadowy, smoky haze that irritates the eyes and increases people's risk of developing a respiratory illness.

It is a distressing reality in what is considered the world's most polluted city.

But technological innovation is paving the way for a promising transformation in the country's capital, by reducing the city's reliance on heavy-polluting cars.

"We can't really ignore the fact that transport emissions are one of the biggest contributors of emissions across cities and, of course, electrification of transport will lead to decarbonising the transport sector."

India is in the midst of an electric vehicle (EV) revolution, similar to other countries around the world.

These new cars are better for the environment, reducing harmful noise and air pollution created from exhaust emissions.

But in many parts of the world, including Australia, the biggest barrier for consumers to get behind the wheel of an electric vehicle is cost.

What sets India apart is how affordable EVs are compared to other countries and the promotion of two and three-wheelers, instead of cars.

India's 'affordable' EVs

As a low-income worker in India, Binota was wary when it came time to buying a new rickshaw six years ago.

Though she had no experience with EVs, she quickly realised that it was cheaper to buy an electric rickshaw instead of a fuel one.

"[Fuel] rickshaws cost more than e-rickshaws," Binota said.

"I always had money problems, so I chose e-rickshaws, the e-rickshaws are affordable and provide a source of income."

In India, a comparatively much lower-income country than Australia, people can get an electric scooter for just $500 or an e-rickshaw for $2,000. 

Just as Binota said, they are becoming cheaper than their fuel counterparts.

"I got a 100,000 rupee ($2,000) loan from the bank for the e-rickshaw," Binota said.

"On the other hand, a fuel one would have cost around 400,000 rupees ($7,800)."

One of India's cheapest electric cars, manufactured by an Indian company, is selling for around $16,500.

In Australia, it would be difficult to find an electric car for cheaper than $45,000.

Elon Musk's Tesla, which is the largest selling electric car brand in Australia, will set people back around $64,000 and a luxury Mercedes Benz EV is as much as $200,000.

So how has India managed to lower the prices of these new vehicles?

EV investment offers lessons for Australia

India has set targets for different types of vehicles to be electric by 2030, including 30 per cent of private cars, 70 per cent of commercial vehicles, and 80 per cent of two and three-wheelers, such as rickshaws.

To achieve this goal, the government has introduced a mix of subsidies, tax and registration fee waivers, preferential parking, and reduced tolls for electric vehicles, which have incentivised people to buy EVs.

Usually this level of demand would see prices skyrocket, but it has also encouraged more sellers into the market, fuelling competition and giving customers the chance to shop around for the best price.

"All of this has created that momentum in the public and raised awareness on the need for transitioning to EVs," Mr Mulukutla said.

India has also benefited from the demand for two-wheel and three-wheel EVs.

By comparison, Australia's electric vehicle sales are mostly from one car maker, Tesla, and a diversity of models have only recently started to come through – including electric utes and vans.

"What we're seeing in India's journey for electrification is a big uptick for two-wheelers and three-wheelers and public transport buses," Mr Mulukutla said.

"I think this is a big difference compared to other countries globally where cars have been the major electrification pattern.

The Indian government is also offering financial incentives for local manufacturing of "high tech automotive products" and batteries instead of relying on imports, to drive the costs down of EVs.

It also joined China in inviting Tesla to set up its first manufacturing plant outside the United States.

But Mr Musk said in May he will not manufacture cars in India unless the government allowed Tesla to first sell and service them locally.

A Tesla is too expensive for the average Indian, and unlike many other countries around the world, it appears the government is pushing ahead with its EV revolution without Mr Musk.

What are the challenges to India's EV revolution?

While the Indian government has made major gains in EV uptake, a recent report has found it won't be able to meet its 2030 targets at the current rate.

The findings from Indian climate analytics firm, JMK Research, also said India needs more charging stations to support the electric vehicles that would be on the road if it was to meet its targets.

"In absolute numbers, this amounts to having 80 million electric vehicles on the road by 2030," the authors wrote.

"The required charging infrastructure, in terms of public and semi-public charging stations to support 80 million EVs, is close to 3.9 million.

"Currently, the number of charging stations are too [few] … and there is not enough focus on this for the future."

Kamaljeet Gill, who is the president of a cab drivers association and has been against the push for EVs in India, is also worried about the lack of charging stations given Delhi's state government has mandated EVs for the service industry with rising targets.

"This is big problem for us, charging facilities should be ramped up," he said.

"They have to set up charging stations in large numbers."

Infrastructure also poses a significant challenge for Australia, given the geographical spread of its most densely populated cities.

In addition, India faces challenges in importing the raw goods needed for local companies to manufacture EVs locally and meet demand.

There is a worldwide shortage of critical minerals needed to produce EVs, especially lithium.

Australia, which is the world's largest producer of the material, will supply some of those critical minerals tariff-free as part of an economic agreement close to a free trade deal signed in April.

It is part of the broader push for both countries to reduce their economic dependence on China, which is the largest producer of most critical minerals in the world.

Meanwhile, India is also facing the gargantuan task of decarbonising its electricity supply — three-quarters of which comes from coal – while providing power to more than 1.4 billion people.

The government has committed to getting half of its electricity from sources other than fossil fuels by 2030.

"I think India I would really say is looking at it from not just one sector, but as a cross-sectoral effort for decarbonising," Mr Mulukutla said.