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Govt subsidy to push EV demand
shayma Shamim
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Published on 6th Oct 21

Govt subsidy to push EV demand

The government's decision to increase subsidies on Electric Cars by 50% under the FAME II program is an "unusual move" for electric motorcycle manufacturers. It will increase the adoption of eco-friendly vehicles. The central government made some changes to introduce and manufacture electric vehicles in India. This includes an increase in demand for electric motorcycles from the first electric vehicle subsidy from Rs 10,000/kWh to Rs 15,000/kWh. Includes plug-in hybrid vehicles and high-performance hybrid vehicles, excluding buses. In the latest study, the Department of Heavy Industry also lifted the incentive limit for electric motorcycles to 40% of the vehicle's value. This is higher than the previous 20%.


“The revised FAME(II) policy increased subsidies per kilowatt-hour by 50%,” said Tarun Mehta, CEO, and co-founder of Ather Energy, in a statement. As per him, despite the pandemic, electric motorcycle sales continue to grow, and with this additional subsidy provided by Central and State Govt. Electric motorcycle sales are expected to hit the market and reach more than 6 million units by 2025. Meta said the government continues to support the promotion of electric vehicles, especially locally made electric motorcycles, making India an electric vehicle producer.

Sohinder Gill believes that Subsidy will accelerate the EV adoption

Sohinder Gill, general secretary of the Electric Vehicle Manufacturers Association (SMEV), said: "This is an important and a respected government decision. It removes one of the biggest barriers to a high price for an electric motorcycle. The price of a "high-speed electric city scooter" with a one-mile run of 100 kilometres is now 60,000, a mile less than a rupee and 80 km cost about 100,000 rupees. Apart from other key factors, such as very low operating costs, low operating costs, and zero emissions, these price levels will certainly drive strong demand for electric motorcycles." He added “We believe the time has come to use electric motorcycles. These initiatives, along with government awareness campaigns and insufficient funding from public banks, are moving closer to the 30% target for motorcycles. Let's ... The market will be in less than five years. It will be electrified."

Govt subsidy to accelerate EV adoption

As part of the FAME-II program, the national government has decided to increase subsidies for electric motorcycles by 50% and to encourage the introduction of environmental-friendly vehicles. The centre has revised the FAME-II regulations to increase the demand for electric motorcycles to 15,000 kWh per hour. This was previously supported on all-electric vehicles (including plug-in and hybrid hybrids), excluding buses. Rs 10,000 per kilowatt-hour. The government has increased electric motorcycles from the previous 20% to 40%. This will bring the price of electric scooters closer to the price of traditional combustion engine vehicles, removing the biggest hurdle in terms of the high cost of selling electric scooters. Other important factors such as low operating costs, low maintenance costs, and zero emissions are driving the demand for electric motorcycles.


FAME India is an important part of the National Electric Vehicle Mission (NEMM). The main idea of ​​FAME is to promote electric vehicles through subsidies. FAME India is an important part of the National Electric Vehicle Mission (NEMM). The main idea of ​​FAME is to promote electric vehicles through subsidies. The National Mission for Electric Vehicle Production aims to encourage the sale of hybrid and electric vehicles to replace traditional vehicles and reduce the national consumption of fusion fuel. It includes Phase 1: Construction began in 2015 and was completed on March 31, 2019, and Phase II: Construction will begin in April 2019 and will be completed by March 31, 2022. The plan includes hybrid and electric technologies such as mild hybrids, high-performance hybrids, plug-in hybrids, and true electric vehicles. The Ministry of Heavy Industry (Ministry of Heavy Industry and State Affairs) is the regulating authority.

The important areas of the FAME India scheme are technology development, demand generation, and a pilot project charging infrastructure. Under the plan, buyers receive an application incentive at the time of purchase and the Ministry of Heavy Industry reimburses the manufacturer every month.

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