The Ministry of Heavy Industries has increased the financial outlay for the second phase of the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles (FAME) Scheme from Rs 1,500 crore to Rs 11,500 crore. This increase will directly benefit electric vehicle buyers. The scheme will remain in force until March 31, 2024.
FAME II Scheme Targets
The government aims to provide financial assistance to 10 lakh electric two-wheelers, 5 lakh electric three-wheelers, 55,000 electric passenger cars, and 7,000 electric buses with the FAME II scheme. As of January 31, a total subsidy of Rs 5,790 crore has been given to electric vehicle manufacturers for the sale of 13.41 lakh electric vehicles.
This includes 11.86 lakh two-wheelers, 1.39 lakh three-wheelers, and 16,991 four-wheeler electric vehicles. Additionally, the government has approved Rs 800 crore as capital subsidy for electric vehicle public charging stations and electric buses.
Will the Time Limit of FAME Subsidy Increase?
The FAME II subsidy is a term-limited scheme that will be applicable until March 31, 2024, or until the funds remain, whichever comes first. Although no announcement has been made regarding extending the time limit of the FAME subsidy, the government’s allocation of funds for the next financial year indicates a possibility of continuing the FAME 2 subsidy scheme.
Industry’s Perspective
The demand and sales of electric vehicles are rapidly increasing in India, especially in the two-wheeler and three-wheeler segments. The electric vehicle industry believes that if the government extends the third phase of the FAME 2 subsidy, it will further contribute to the industry’s growth. The time limit for the FAME 2 scheme is set to end on March 31, 2024.
News Summary:
★The Ministry of Heavy Industries has increased the financial outlay for the FAME II scheme from Rs 1,500 crore to Rs 11,500 crore.
★The government aims to provide financial assistance for electric vehicles, including two-wheelers, three-wheelers, passenger cars, and buses.
★A total subsidy of Rs 5,790 crore has been given to electric vehicle manufacturers for the sale of 13.41 lakh electric vehicles.
★The FAME II subsidy scheme is term-limited and will be applicable until March 31, 2024, or until the funds remain.
★The electric vehicle industry believes that extending the FAME 2 subsidy will contribute to its growth.
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