EV Subsidy Scheme: Cabinet Approves PM E-DRIVE With An Outlay Of INR 10,900 Cr

EV Subsidy Scheme: Cabinet Approves PM E-DRIVE With An Outlay Of INR 10,900 Cr

SUMMARY

PM E-DRIVE, which will effectively replace the FAME scheme, will have an outlay of INR 10,900 Cr for a period of two years

It will provide subsidies and demand incentives worth INR 3,679 Cr for electric two-wheelers, three-wheelers, ambulances, trucks and other emerging EVs

Under the scheme, the Ministry of Heavy Industries will launch e-vouchers for EV buyers to avail demand incentives

After months of speculations over the Centre’s plans for the launch of the third iteration of the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme, the union cabinet has approved ‘PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme’ for the promotion of electric vehicles in the country. 

PM E-DRIVE, which will effectively replace the FAME scheme, will have an outlay of INR 10,900 Cr for a period of two years. It is pertinent to note that this is higher than the INR 10,000 Cr initial outlay of the FAME- II scheme.  

The new scheme will provide subsidies and demand incentives worth INR 3,679 Cr for electric two-wheelers (E2Ws), three-wheelers (E3Ws), ambulances, trucks and other emerging EVs. With this, the government aims to support 24.79 Lakh E2Ws, 3.16 Lakh E3Ws, and 14,028 ebuses.

Under the scheme, the Ministry of Heavy Industries (MHI) will launch e-vouchers for EV buyers to avail demand incentives. “At the time of purchase of the EV, the scheme portal will generate an Aadhaar authenticated e-Voucher for the buyer. A link to download the e- voucher shall be sent to the registered mobile number of the buyer,” a government statement said.

Further, the government has earmarked INR 4,391 Cr for the purchase of 14,028 ebuses for public transport agencies. These buses will be deployed in nine cities – Delhi, Mumbai, Kolkata, Chennai, Ahmedabad, Surat, Bengaluru, Pune and Hyderabad. Convergence Energy Services Limited (CESL) will be responsible for the demand aggregation.  

PM E-DRIVE will also boost India’s charging infrastructure by promoting installation of electric vehicle public charging stations (EVPCS). The government is targeting installation of 22,100 fast chargers for E4Ws, 1,800 fast chargers for ebuses and 48,400 fast chargers for E2Ws and E3Ws under the scheme. The budget allocation for the charging infrastructure is INR 2,000 Cr. 

“The primary objective of the PM E-DRIVE scheme is to expedite the adoption of EVs by providing upfront incentives for their purchase, as well as by facilitating the establishment of essential charging infrastructure for EVs,” the Centre said. 

Besides, the scheme also has an outlay of INR 780 Cr for the upgradation of test agencies of MHI with new and emerging technologies. The upgradation of the testing capabilities might be a direct response to the gaps observed in vehicles under the FAME-II. Companies like Hero Electric, Okinawa Autotech, Ampere EV were also fined for violations of the norms of the scheme. 

The announcement comes a few days after it was reported that the government is considering expanding the outlay for the third rendition of the FAME scheme to INR 11,000 Cr. 

FAME-II was approved in 2019 with an outlay of INR 10,000 Cr for a period of three years. However, the deadline was extended by the government from March 31, 2022 to March 31, 2024. Following this, the Centre launched the Electric Mobility Promotion Scheme (EMPS) with an allocation of INR 500 Cr as a stop-gap measure to promote EV adoption.

Besides the launch of PM E-DRIVE, the union cabinet alson approved the ‘PM-eBus Sewa-Payment Security Mechanism (PSM) scheme’ with an outlay of INR 3,435.33 Cr for procurement and operation of ebuses by public transport authorities (PTAs).

You have reached your limit of free stories
Become An Inc42 Plus Member

Become a Startup Insider in 2024 with Inc42 Plus. Join our exclusive community of 10,000+ founders, investors & operators and stay ahead in India’s startup & business economy.

2 YEAR PLAN
₹19999
₹7999
₹333/Month
Unlock 60% OFF
Cancel Anytime
1 YEAR PLAN
₹9999
₹4999
₹416/Month
Unlock 50% OFF
Cancel Anytime
Already A Member?
Discover Startups & Business Models

Unleash your potential by exploring unlimited articles, trackers, and playbooks. Identify the hottest startup deals, supercharge your innovation projects, and stay updated with expert curation.

EV Subsidy Scheme: Cabinet Approves PM E-DRIVE With An Outlay Of INR 10,900 Cr-Inc42 Media
How-To’s on Starting & Scaling Up

Empower yourself with comprehensive playbooks, expert analysis, and invaluable insights. Learn to validate ideas, acquire customers, secure funding, and navigate the journey to startup success.

EV Subsidy Scheme: Cabinet Approves PM E-DRIVE With An Outlay Of INR 10,900 Cr-Inc42 Media
Identify Trends & New Markets

Access 75+ in-depth reports on frontier industries. Gain exclusive market intelligence, understand market landscapes, and decode emerging trends to make informed decisions.

EV Subsidy Scheme: Cabinet Approves PM E-DRIVE With An Outlay Of INR 10,900 Cr-Inc42 Media
Track & Decode the Investment Landscape

Stay ahead with startup and funding trackers. Analyse investment strategies, profile successful investors, and keep track of upcoming funds, accelerators, and more.

EV Subsidy Scheme: Cabinet Approves PM E-DRIVE With An Outlay Of INR 10,900 Cr-Inc42 Media
EV Subsidy Scheme: Cabinet Approves PM E-DRIVE With An Outlay Of INR 10,900 Cr-Inc42 Media
You’re in Good company