Progress in Sales of EVs/Hybrid Vehicles Under FAME Scheme

The DHI has been administrating FAME India for the adoption of EVs/ hybrid vehicles in India since 2015, and Union Minister Prakash Javadekar has now shed some light on the progress

The Department of Heavy Industry (DHI) is administrating Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (EVs) in India (FAME India) Scheme for promotion of adoption of EVs/Hybrid Vehicles (xEVs) in India since April 1, 2015. The Phase-I of the Scheme was extended from time to time and the last extension was allowed till March 31, 2019.

Presently, Phase-II of the FAME India Scheme is being implemented for a period of 3 years from April 01, 2019, with total budgetary support of Rs 10,000 crore. This phase will mainly focus on supporting electrification of public and shared transportation, and aims to support through subsidies approximately 7000 e-Buses, 5 lakh e-3 Wheelers, 55000 e-4 Wheeler Passenger Cars and 10 lakh e-2 Wheelers. With a greater emphasis on providing affordable and environment-friendly public transportation options for the masses, the scheme will be applicable mainly to vehicles used for public transport or those registered for commercial purposes in e-3W, e-4W and e-bus segments. However, privately owned registered e-2W will also be covered under the scheme as a mass segment.

In a written reply to a question raised in the Rajya Sabha, Minister of Heavy Industries & Public Enterprises, Prakash Javadekar has now informed that in the First Phase of the Scheme about 2.8 lakh hybrid and electric vehicles are supported by way of demand incentive amounting to about Rs 359 crore. Further, DHI sanctioned 425 electric and hybrid buses to various cities in the country with a total cost of about 300 Crores. Out of 425 electric and hybrid buses, about 417 buses are plying on the road. The DHI also sanctioned about 500 charging stations/ infrastructure for Rs 43 crore (approximately) in cities like Bangalore, Chandigarh, Jaipur and NCR of Delhi under Phase-I of FAME-India Scheme.

Under Phase-II of the FAME India Scheme, about 10,000 Electric Vehicles (EVs) are supported by the way of Demand Incentive amounting to about Rs 27 crore so far. Further, 5595 electrical buses amounting to Rs 2800 crore government incentive are sanctioned to various States (City Transport Undertakings) under Phase-II of the Scheme. DHI has also sanctioned 2,636 EVs amounting to Rs 500 crore and charging stations in 62 cities across 24 States/UTs.

The minister further stated that the adoption of EVs is facing roadblocks due to a lack of charging stations. In the last 10 months, about 11000 EVs have been purchased by consumers under FAME-II Scheme and efforts of DHI in the establishment of charging Stations are resulting in an increase in the sale of EVs.

The minister also informed that the following initiatives were also taken up by the Government to promote electric/ hybrid vehicles (including shared mobility) use in various part of the country:

(i) Under the new GST regime, GST on EVs is reduced from the existing 12 percent rate to 5 percent as against the 28 percent GST rate with cess up to 22 percent for conventional vehicles.

(ii) Ministry of Power has allowed the sale of electricity as a service for the charging of electric vehicles. This will provide a huge incentive to attract investments into the charging infrastructure.

(iii) The Government has also granted an exemption to the Battery Operated Transport Vehicles and Transport Vehicles running on Ethanol and Methanol fuels from the requirements of the permit.

(iv) The Government has proposed the exemption of registration fees for battery operated/electric vehicles to promote the use of eco-friendly vehicles in the country.

(v) In the budget of 2019-20, the  Finance Minister announced for providing additional income tax deduction of Rs 1.5 lakh on the interest paid on loans taken to purchase electric vehicles.