For every electric two-wheeler sold till March 2025, the recently launched PM E-Drive electric vehicle (EV) subsidy scheme would pay a subsidy of Rs 10,000. Next fiscal year, this support will be cut in half. A Rs 50,000 subsidy is available under the policy for electric 3-wheelers; starting in April, this incentive would drop to Rs 25,000.
The scheme’s specifics were revealed by Union Heavy Industries Minister HD Kumaraswamy on Thursday. He stated that the goal is to reach a 10% market share for electric 2-wheelers and a 15% market share for electric 3-wheelers by March 2026. In order to support cleaner mobility options, the program aims to increase the adoption of EVs and develop necessary charging infrastructure.
When asked why electric cars were left out of the program, Kumaraswamy responded that the GST rate on these cars is only 5%.
The new program was created by the government in response to the failures of the earlier FAME stages, which had problems with companies selling mostly foreign cars and falsely claiming subsidies meant for EVs made in the country. As a result, the government had to act to retrieve these funds that had been improperly taken.
Heavy Industries Secretary Kamran Rizvi explained that a conformity of production (COP) test will be undertaken every six months as part of the new plan to verify compliance with domestic manufacturing standards.
