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Govt Increases Outlay For FAME I Electric Vehicle Plan To $126.74 Mn

Govt Increases Outlay For FAME I Electric Vehicle Plan To $126.74 Mn

Govt plans to promote the mass adoption of electric vehicles through the FAME programme

The increase in outlay followed a recommendation from the Expenditure Finance Committee

Ministry of Finance has approved the additional $14.61 Mn (INR 100 Cr) outlay

In a gazette notification, the Ministry of Heavy Industries and Public Enterprises said that the government has increased the outlay for the first phase of Faster Adoption and Manufacturing of Hybrid and Electric vehicles (FAME) scheme to $126.74 Mn (INR 895 Cr).

The FAME scheme is part of the government’s ambitious National Electric Mobility Mission Plan to convert at least one-third of the automobiles on Indian roads to EVs by 2030. The Indian government launched the FAME scheme in 2015, with the first phase set to be implemented over two years between April 1, 2015 – March 31, 2017, at an initial outlay of $112.71 Mn (INR 795 Cr).  However, the programme has so far received four extensions of six months each.

In the first phase of the FAME scheme, the government is trying to incentivise the purchase of hybrid and electric cars, two-wheelers, and three-wheelers. Approximately 2,18,625 Electronic Vehicles were ‘promoted’ by FAME I till July 2018.

Industry experts believe that these subsidies and the effective rollout of the FAME India scheme are extremely important for sustainable development of the EV ecosystem in the country.

According to a study by FICCI and Rocky Mountain Institute, transitioning to 100% electric vehicles could help India could help save up to $300 Bn (INR 20 Lakh Cr) in oil imports and nearly 1 gigatonne of carbon dioxide emissions by 2030.  However, after ambitious plans of 100% electric mobility by 2030, the government took it down to 30%.

In line with its goals, the government is also working on the second phase of FAME which has proposed setting up of a venture capital fund of $70.85 Mn (INR 500 Cr) for development of a manufacturing base for zero-emission vehicles and their components, taking prototypes to manufacturing, and development of R&D among others. As many as 136 startups related to electric vehicles already exist in India.

The central government in August this year agreed to provide subsidies for all categories of electric vehicles — two, three, and four-wheelers — as part of the second phase of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme. The government had initially rolled out subsidies for electric buses only.

With continued strive to enable electric mobility framework in India, the government’s electric vehicle policy still remains awaited.

[The development was reported by ET.]

Author

Bhumika Khatri

Inc42 Staff

Hailing from a business-oriented family, Bhumika has always been crunching numbers in her head. Words are her escape and she looks to find hidden startup stories. Reach her on [email protected]

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