By Central Government introduced FAME (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India) scheme to promote electric and hybrid vehicles on April 1, 2019, and in June 2021 the government extended it for two more years which will end on April 31, 2024. For the two-wheeler industry, the government further increased the subsidy to Rs. 15,000/kWh from Rs. 10,000/kWh and the maximum cap increased from 20 per cent to 40 per cent of the price.
Now the Ministry of Heavy Industries (MHI) has revised the subsidy scheme as part of FAME-II for electric two-wheelers to Rs. 10,000/kWh which is what was offered before the June 2021 update but the big news is that the incentive has come down from 40 per cent to just 15 per cent of the price, which will make a big impact on the price. Most of the electric two-wheeler manufacturers are expected to increase the price to around 35,000 to 40,000 from the current ex-showroom price.
Some manufacturers who have invested under the Production Linked Incentive Scheme will get some benefits so the price increase will be not as high. With the help of the FAME-II scheme, the government expected the sales of two-wheeler electric vehicles to reach 10 lakh units and according to the FAME scheme dashboard, the current sales stand at 9,88,676 units and we are expecting the 11,324 remaining units to be reached soon which might end the subsidy completely.
