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Govt To Give Final Approval For FAME II Scheme By March

Govt To Give Final Approval For FAME II Scheme By March

The FAME II scheme will be valid for the next five years

Under this, the government aims to install around 300 electric vehicle charging stations

Centre will also focus on deployment of electric buses

The Ministry of Heavy Industries and Public Enterprises is reportedly hoping to get final approval from the central government for INR 5,500 Cr ($772.4 Mn) outlay in the second chapter of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme before March 31, a media report said citing a senior government official.

According to the secretary of Ministry of Heavy Industries and Public Enterprises, AR Sihag, this scheme will be valid for the next five years. With this policy, the central government is planning to prioritise the development of public transportation, shared mobility, and smaller electric vehicles such as two-wheelers.

According to reports, under the FAME II scheme, the government aims to install around 300 electric vehicle charging stations along the Indian highway by end of this year. The installations will initially begin with the Delhi-Jaipur-Agra highway triangle and the Mumbai-Pune highway.

While speaking to the media, Sihag also pointed it out the major change under this scheme is that the ministry will implement the use of advanced batteries instead of lead acid batteries.

In order to boost electric mobility, the government has been also focusing on developing the batteries and charging infrastructure. Last month, reports stated that the government has directed the public charging stations to install both the Japanese and Chinese charging technologies.  

Under the second FAME scheme, the government will be majorly focusing on the deployment of electric buses on the Indian roads. This move comes from the response received by the Centre during FAME I when it received around 47 proposals which demanded deployment of 3,144 buses across 44 cities.

He also added that consumers using complete electric vehicles will be enjoying tax benefits but did not inform about the incentives on use of hybrid vehicles.

Earlier in August 2018, reports stated that the government had decided to provide subsidies for all categories of electric vehicles including two, three, and four-wheelers. After an inter-ministerial panel meeting, the ministry officials had decided that under the FAME II scheme:

  • Incentives will be provided based on technology, to battery-operated scooters and motorcycles in a range of INR 1,800 ($25) to INR 29K ($407)
  • The incentives will range from INR 3,300 ($46) to INR 61K ($857) for three wheelers
  • The government will not hold back FAME II incentives for private electric cars and SUVs

FAME: Policy Implementation Slow To Take Off

The central government had launched the FAME scheme in 2015, with a planned expiry on March 2017. However, in order to boost the production and adaptation of electric vehicles, the scheme had been extended four times while the government has been deciding on the FAME II framework.

In November 2018, the government had increased the outlay for FAME I scheme to INR 895 Cr ($125.8 Mn).

Under the FAME I scheme, incentives were being offered on purchase of strong hybrid and electric cars, two-wheelers, and three-wheelers. Automotive manufacturers were to claim the incentive from the government at the end of each month.

According to industry experts, the subsidies and an effective rollout of the FAME India scheme are extremely important for sustainable development of the EV ecosystem in the country.

At a time when the government trying to achieve the goal of increasing the number of electric vehicles to 30% among the new vehicles by 2030, a clear and distinct electric vehicle policy and FAME subsidies will help in boosting the adoption of emobility.

[The development was reported by ET]