EV Manufacturers Granted INR 5,294 Crore Subsidy Under Phase-II Of FAME Scheme

The Ministry of Heavy Industries has granted a subsidy amounting to INR 5,294 crore to electric vehicle manufacturers. The initiative is part of the second phase of the 'Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India' program. According to a statement by Minister of State for Heavy Industries, Krishan Pal Gurjar, this subsidy is linked to the sale of 1.1 million electric vehicles.

Because of various incentive schemes, the manufacturing and use of EVs has increased from the last year's 10,25,118 to 14,33,545 this year, the minister said. The ratio of EVs to other conventional vehicles was 0.0631 which is a slight increase from the previous year's 0.0475.

Furthermore, the ministry has approved 6,862 electric buses for deployment in various cities, transport corporations, and other government entities for intracity operations. Of these, 3,487 electric buses have already been supplied to state transport corporations.

Additionally, the Ministry of Heavy Industries has allocated INR 800 crore as a capital subsidy to three state-owned Oil Marketing Companies (OMCs) for the establishment of 7,432 public charging stations for electric vehicles.

Incentivizing Automotive Innovation

The ministry has also introduced two production-linked incentive schemes to boost domestic manufacturing of advanced automotive technology products, including electric vehicles and advanced chemistry cells.

Under the Production Linked Incentive (PLI) Scheme for the Automobile and Auto Component Industry, a budgetary outlay of INR 25,938 crore has been allocated. This scheme offers incentives of up to 18 per cent of eligible sales for electric vehicles and their components.

Simultaneously, the government has greenlit the Production Linked Incentive (PLI) scheme for Advanced Chemistry Cells (ACC) Battery Storage. With a budget of INR 18,100 crore, this scheme aims to incentivize the domestic manufacturing of Advanced Chemistry Cells. The goal is to establish Giga-scale ACC manufacturing facilities in the country, producing 50 GigaWatt hours (GWh). These ACCs are crucial components in batteries, contributing to the widespread adoption of electric vehicles.

Upswing in EV Adoption

The minister also revealed that India saw the registration of over 2.27 crore vehicles in 2023, including a diverse range of electric, petrol, and diesel vehicles. This data underscores a notable upswing in the adoption of electric vehicles (EVs) within the country.

The FAME India Phase II Scheme, backed by a substantial INR 10,000 crore allocation, is geared towards promoting hybrid and electric vehicle technology. The primary objective is to diminish reliance on fossil fuels and curtail vehicular emissions. Notably, this scheme concentrates on subsidizing electric buses, three-wheelers, and four-wheelers utilized in public or commercial transport, as well as privately owned electric two-wheelers.