Government Initiatives to Boost Electric Vehicle Sector in India

Around 45,74,938 electric vehicles have been registered on e-Vahan portal till July 29 as per the information received from the Ministry of Road Transport & Highways (MoRTH). The number of electric vehicles registered in India in FY 2023-24 increased by 42.06 percent as compared to that in FY 2022-23.

Ministry of Heavy Industries is currently implementing various schemes for accelerating the adoption of electric vehicles in the country such as Electric Mobility Promotion Scheme (EMPS), Production Linked Incentive Scheme for Automobile and Auto Component Industry, Production Linked Incentive Scheme for manufacturing of Advanced Chemistry Cell and scheme to promote manufacturing of electric passenger cars to attract investments from global EV manufacturers and promote India as a manufacturing destination for e-vehicles.

The Ministry of Heavy Industries (MHI) formulated a Scheme namely; Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) Scheme in 2015 to promote adoption of electric/ hybrid vehicles (xEVs) in India. The Phase-I of the scheme was available up to March 31, 2019 with budget outlay of INR 895 Crore. This phase of FAME India Scheme had four focus areas i.e. technological development, demand generation, pilot project and charging infrastructure components.

In the 1st phase of the scheme, about 2.8 lakh xEVs were supported with total demand incentives of INR 359 Crore. In addition, 425 electric and hybrid buses, as sanctioned under first phase of the scheme were deployed across various cities in the country with Government Incentive of about INR 280 Crore. The Ministry of Heavy Industries had also sanctioned about 520 Charging Stations/ Infrastructure for INR 43 Crore under Phase-I of FAME India Scheme.

Projects worth about INR 158 Crore were sanctioned for the technology development projects like establishment of testing Infrastructure, setting up of ‘Centre of Excellence’ for Advanced Research in Electrified Transportation, Battery Engineering, etc. to various organisations / institutions like Automotive Research Association of India (ARAI), IIT Madras, IIT Kanpur, Non Ferrous Material Technology Development Centre (NFTDC), Aligarh Muslim University (AMU), etc.

Based on outcome and experience gained during Phase-I of FAME India Scheme and after having consultations with all stakeholders, including Industry and Industry Associations, the Government notified Phase-II of FAME India Scheme for a period of five years commencing from April 1, 2019 with a total budgetary support of INR 11,500 crore.

This phase-II mainly focused on supporting electrification of public & shared transportation, and aimed to support through demand incentive 7,262 e-Buses, 1,55,536 e-3 Wheelers, 30,461 e-4 Wheeler Passenger Cars and 15,50,225 e-2 Wheelers. In addition, creation of charging infrastructure is also supported under the Scheme.

Under Phase-II of FAME India Scheme, as on July 31, claims of 16,71,606 electric vehicles for INR 6,825 crore have been submitted for reimbursement of subsidy by the OEMs (EV manufacturers) which include 14,69,343 two-wheelers, 1,78,952 three wheelers and 23,311 four-wheelers. Further, 6862 electric buses were sanctioned to various State Government entities for intra-city operations under the FAME-II Scheme. Out of 6,862 e-buses, 4,853 e-buses have been supplied till July 31.

MHI has also sanctioned INR 800 Crore as capital subsidy to the three Oil Marketing Companies (OMCs) of the Ministry of Petroleum and Natural Gas (MoPNG) for establishment of 7,432 electric vehicle public charging stations. Subsidy of INR 560 crore has already been released to OMCs. Further, in March 2024, MHI sanctioned additional INR 73.50 Crore under FAME II to OMCs for set up/upgradation 980 public fast charging stations by installing new chargers across the country. Subsidy of INR 51.45 crore has already been released to OMCs.