Electric cars or EVs are the future of mobility. However, ‘price’ is one of the biggest hurdles for eco-friendly vehicles. Especially in a fee-touchy marketplace consisting of India. In any such state of affairs, government-furnished subsidy on electric automobiles turns into vital to smoothen the road for EVs in India. Here we explain everything about electric vehicle subsidy in India and how it affects the buyers.
FAME program
The Faster Adoption and Manufacturing of (Hybrid) Electric Vehicles in India (FAME) is an incentive program launched by the government to provide subsidies for electric vehicles. The EV incentive program turned into supplied in 2013 as part of the National Mission on Electric Mobility 2011/National Electric Mobility Mission Plan 2020.
The FAME I scheme’s first segment become accredited for a two-year duration, starting April 1, 2015. And since then, the EV subsidy program has been periodically extended. The first phase of FAME was last extended to March 31, 2019. The FAME scheme uses the Demand Incentive Disbursement Mechanism (DIDM). The government has already determined the subsidy amount for each vehicle category (pure electric, hybrid, etc.) based on technology and battery specifications.
FAME II Program
FAME II is the electric car incentive program’s 2nd section, which went live on April 1, 2019. Beginning April 2019, the government launched a three-yr incentive program with a budget of Rs. 10,000 crores.
The government expects the FAME II e-vehicle subsidy to support 7,000 e-buses, 5 lakh electric three-wheelers, 55,000 electric cars, and 10 lakh electric two-wheelers.The government has extended the EV subsidy program until March 2024. The increased subsidy for electric two-wheelers is one of the key highlights of the revised FAME II scheme.
Initially, the incentive for two-wheeler EVs was set at ₹10,000 per kWh. The government has now increased it by 50% to ₹15,000 per kWh. Additionally, it has raised the e-vehicle subsidy cap from 20% to 40% of the vehicle’s price. The subsidy for electric powered motors (4-wheelers) remains unchanged at Rs. 10,000 in step with kWh. For an electric car, the maximum incentive price is Rs. 1.Five lakh
State Policies
In India, each state has its EV policy framed at the side of the FAME subsidy scheme. So, the incentives on battery-powered automobiles differ. Hence, states can price EVs differently. Most states exempt electric 4-wheelers from road tax entirely under their subsidy policies, except Kerala, Gujarat, and Uttar Pradesh. In Kerala and Gujarat, buyers pay 50% of the total road tax, while in Uttar Pradesh, buyers pay 70%. Meanwhile, authorities nationwide have waived registration fees for all types of EVs. The Ministry of Road Transport and Highways (MoRTH) announced ultimate August that all battery-powered automobiles are exempt from prices for issuing or renewing registration certificate.
One of the primary reasons behind the sluggish sales of EVs in India is the cost. The in advance cost to personal an electric powered automobile is way better than conventional motors. The 2nd number for the hesitancy of EV adoption is the dearth of charging infrastructure. It has precipitated variety anxiety many of the buyers. Both these challenges must be addressed to pave the way for smoother adoption of EVs in India.
