EV incentives to continue? Proposal to extend FAME II scheme shared with Centre

The FAME II scheme, floated by the Centre to promote adoption of electric vehicles in India, will expire in April next year. However, several industry
...
Electric vehicle
The FAME II scheme, floated by the Centre to promote adoption of electric vehicles in India, will expire in April next year.
Electric vehicle
The FAME II scheme, floated by the Centre to promote adoption of electric vehicles in India, will expire in April next year.

Industry body FICCI on Monday said it has submitted its proposal to the Ministry of Heavy Industries for the continuation of the FAME scheme for the next five years, with a review at the end of three years.

The time period for the current FAME II scheme is till March 2024.

Sudden withdrawal or discontinuation of upfront price incentives will lead to up to 25 per cent price increase of EVs and this may derail EV adoption momentum substantially, also impacting further investments in the EV sector, and disrupting gains made so far, noted FICCI.

Also check these Vehicles

Find more Cars
Mg 4 Ev (HT Auto photo)
UPCOMING
64kWh 160 Kmph 350 km
₹ 30 - 32 Lakhs
View Details
Tata Sierra Ev (HT Auto photo)
UPCOMING
69 kWh 170 Kmph 420 Km
₹ 25 - 30 Lakhs
View Details
Tata Harrier Ev (HT Auto photo)
UPCOMING
50 kWh 400 Km
₹ 22 - 25 Lakhs
View Details
Honda Elevate Ev (HT Auto photo)
UPCOMING
₹ 18 Lakhs
View Details
Tata Punch Ev (HT Auto photo)
35 Kwh 85 Kmph 421 km
₹ 10.99 - 15.49 Lakhs
Compare
View Offers
Mg Comet Ev (HT Auto photo)
17.3 kWh 100 Kmph 230 km
₹ 7.98 - 9.98 Lakhs
Compare
View Offers

Purchase incentives on EV vehicles are being continued in markets like Canada, the US, Korea, etc. to achieve their electrification ambitions and India cannot be left behind and miss the EV bus, it argued.

"EV penetration in India is only 5 per cent currently. It is imperative to continue FAME scheme to achieve critical mass towards reaching overall 30 per cent EV penetration targets by 2030, stated by Government of India and to also help meet 'Panchamrit' / Net Zero climate action goals of India," FICCI stated.

Based on the input received from its wide base of members comprising of various stakeholders from the EV sector, FICCI EV Committee has estimated that if demand incentives as suggested are provided for the next five years, it could support adoption of 30.5 million electric vehicles across segments in next five years and help achieve the target of 30 per cent electrification of India's transport sector.

"FAME has emphasized Make in India with its stringent localization norms. Sudden discontinuation of FAME could lead to not only reversal in demand growth but also in investments in EV sector, and to Make in India," the chamber emphasised.

Success of the PLI scheme introduced by GoI also depends on continued demand for EVs, it added.

FICCI said that over the next 3-5 years, as the prices of batteries reduce further, and also prices of EV components reduce due to scale effect, demand incentives can be tapered down and eventually discontinued.

First Published Date: 06 Dec 2023, 09:23 AM IST
NEXT ARTICLE BEGINS

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city

Want to get the best price for your existing car?

Powered by: Spinny Logo
By clicking "View Offers" you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.