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In a significant push towards electric vehicle (EV) adoption, the Madhya Pradesh government has introduced its EV Policy 2025, proposing subsidies ranging from ₹5,000 to ₹10 lakh across various EV categories. The policy, currently in its draft stage and open for public feedback, aims to complement the central government's PM E-Drive scheme by offering additional state-level incentives.
The proposed financial support extends to electric cars, two-wheelers, three-wheelers, cycles, and commercial vehicles. Notably, passenger vehicles are not covered under the Centre’s PM E-Drive scheme, but the state government has stepped in to fill the gap. Under the new policy, electric car buyers will receive a maximum subsidy of ₹50,000 per vehicle or ₹2,500 per kWh based on battery capacity. This will apply to up to 10,000 EVs with an ex-factory price of less than ₹25 lakh. Additional benefits include a 100% exemption from vehicle tax and registration fees, along with a one-year parking fee waiver.
For two-wheeler buyers, the state will offer a subsidy of up to ₹10,000 per unit or ₹5,000 per kWh based on battery capacity for up to one lakh EVs priced under ₹1.5 lakh. Regulatory benefits include a full exemption from vehicle tax and registration fees, a one-year parking fee waiver, and a scrapping incentive of ₹5,000 per vehicle. A retrofitting incentive of up to ₹5,000 per vehicle is available for 2,000 vehicles.
Electric three-wheeler buyers will receive a subsidy of ₹20,000 per unit or ₹5,000 per kWh for up to 15,000 vehicles with an ex-factory price below ₹5 lakh. Additional benefits include 100% tax exemption, reduced loan interest rates, and permit exemptions. Buyers will also receive a one-year parking fee exemption, a scrapping incentive of up to ₹7,500 per vehicle, and retrofitting incentives of up to ₹10,000 per vehicle for 3,000 vehicles.
To encourage electrification in public transport and essential services, the state government will provide a capital subsidy of ₹10 lakh per unit for up to 100 electric buses in both government and private sectors. Buyers will also receive a 100% exemption from vehicle tax and registration fees, along with a 5% interest subvention on loan interest rates. A retrofitting incentive of up to ₹2.5 lakh per vehicle is available for 100 buses each in both sectors.
For light commercial vehicles (e-LCVs), the state will provide a capital subsidy of ₹50,000 per vehicle or ₹5,000 per kWh for up to 5,000 units, along with full tax exemptions and a one-year parking fee waiver. However, no scrapping or retrofitting incentives will be applicable to this category.
For e-cycle buyers, a capital subsidy of ₹5,000 per vehicle is available for up to 30,000 vehicles with an ex-factory price of less than ₹40,000, along with a one-year free parking exemption.
To finance this initiative, the state government will introduce an air quality improvement cess of 10 paise per litre on diesel, higher road taxes for luxury petrol and diesel vehicles valued above ₹25 lakh, and penalties for violating green zone regulations in five designated EV model cities—Bhopal, Indore, Jabalpur, Gwalior, and Ujjain.
The policy aims to achieve significant EV penetration by 2030, targeting 15% of all new registrations in the four-wheeler segment, 40% in two-wheelers (with 100% electrification in commercial fleets), 70% in three-wheelers, 40% in buses, and 15% in light commercial vehicles.
With these measures, the Madhya Pradesh government aims to accelerate EV adoption, reduce pollution, and establish the state as a leading hub for electric mobility.
