Over ₹5,200 crore disbursed Under FAME II subsidy for electric vehicles: MHI
The Ministry of Heavy Industries (MHI) recently that ₹5,228 crore was disbursed in subsidies for electric cars, two-wheelers, and three-wheelers under the FAME II subsidy. MHI disclosed the details as part of its year-end review of 2023, while also revealing that the subsidy benefitted the sale of 11,53,079 electric vehicles as of December 1, 2023.
The Faster Adoption and Manufacturing of Electric Vehicles in India Phase II (FAME II) subsidy was originally announced in April 2019 with an outlay of ₹10,000 crore over five years. It is set to expire on March 31, 2024. Out of the total ₹10,000 crore, about ₹2,000 crore were allocated towards electric two-wheelers, which was nearly utilised and the government had to allocate an additional ₹1,500 crore towards subsidising electric scooters and motorcycles.
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The push comes amidst growing local and global players in India, especially in the mass market space. Companies like Ola Electric, Ather Energy, TVS and Bajaj are leading the electric scooter segment, while manufacturers like Simple Energy, Matter, and more, are all set to bring more products to this space. Other traditional OEMs are also eyeing the EV space with several new electric two-wheelers in the works.
The EV space has also seen a major hike in sales when it comes to electric cars. Tata Motors has been the most beneficial of the subsidy with an early mover advantage in this space. The company retails three EVs at the moment including the Nexon EV, Tigor EV, and Tiago EV, and recently crossed the one lakh sales mark for electric vehicles in the country. It’s expected to bring at least three new EVs in India next year.
The recent years have also seen the adoption of electric three-wheelers replacing ICE three-wheelers in several markets. Start-ups like Euler Motors, Altigreen, Piaggio and more have been instrumental towards the faster adoption of e-three-wheelers, with a massive growth potential in this space.
Furthermore, the Ministry of Heavy Industries revealed that different state and central transport undertakings have placed supply orders for 3,390 for electric buses, of which 3,037 e-buses have been deployed so far. Additionally, 3,472 e-buses are being deployed through Convergence Energy Services Ltd. (CESL), of which 454 buses are already plying on the roads.
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MHI also revealed that a total of 148 EV public charging stations have been commissioned, while ₹800 crore was sanctioned on March 28, 2023, under the FAME II scheme to PSU oil marketing companies for setting up 7,432 public fast charging stations across the country. The ministry also announced its PLI Scheme to boost auto and auto component manufacturing in India. MHI revealed that 85 companies comprising 18 under Champion OEM and 67 under Component Champion implemented the PLI Auto Programme. The scheme is expected to attract fresh investments to the tune of ₹67,690 crore.
