According to reports, the Heavy Industries Ministry plans to increase prices for electric two-wheelers under its flagship FAME-II initiative from the existing level of Rs 2,000 crore and decrease the subsidy per vehicle.
There is currently no proposal for either the introduction of FAME-III or the extension of FAME-II past March 2024, according to a government official who asked to remain unnamed.
According to the official, 24 electric two-wheeler OEMs registered under FAME-II were invited to a stakeholder meeting where it was decided to keep the demand incentive at Rs. 10,000 per kWh of battery capacity and cap it at 15% of ex-factory prices, down from 40% at the moment.
The official added that the Programme Implementation and Steering Committee (PISC) will soon be presented with a proposal in this regard to implement amendments to the Rs 10,000 crores FAME-II Scheme.
The official said, on Tuesday, we invited the 24 registered OEMS of electric two-wheelers to a meeting. The scheme will expire in two months at the current rate of disbursement (40% cap on ex-factory price), hence it was decided to shift the unused subsidies totalling Rs. 1,500 crores from three and four-wheelers to two-wheelers.
He mentioned that the majority of two-wheeler OEMs felt that the subsidy should last longer, even if it were to be reduced. As a result, an agreement was reached to extend the programme through February and March by cutting the subsidy for two-wheelers to 15%.
He argued that eventually, the industry has to stand on its own feet while acknowledging that the rapid growth of electric two-wheeler sales may slow down a little.
The government is dedicated to giving the industry the support it needs to promote sustainable growth and lower carbon emissions, according to Union Minister of Heavy Industries Mahendra Nath Pandey, who addressed the matter.
The agreement reached during the stakeholder dialogue signifies a step in the right direction for India’s sustainable transport options. India can become a global leader in sustainable mobility and lessen its reliance on fossil fuels with ongoing government and industry cooperation and initiatives.
The minister said that the action “will not only benefit the environment but also help build a stronger and more resilient economy.”
In a nutshell, the plan for Faster Adoption and Manufacturing of Electric and Hybrid Vehicles in India began on April 1, 2019, and will last for three years. In the end, it was prolonged for a further two years, ending on March 31, 2024.
It’s appropriate to wean the subsidies commensurate with increase in production and subsequent cost containment. The sale has to be based on savings accruable to owners Vis A Vis ICE
Yes a small subsidy to offset the battery initial cost is welcome. The propagation of Swapping technology will again reduce the upfront cost of the 2 / 3 W
In fact a good move and the industry should explore ways and means of cost containment and reduction due to increase in production