EV: Electric two-wheelers to become costlier from June, FAME-2 subsidy cut

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FAME-II Subsidy Cut on Electric 2-wheelers from June: The government has reduced the subsidy given under the FAME-2 (Faster Manufacturing and Faster Adoption of Electric Vehicles in India) scheme applicable to electric two-wheelers. This decision will be applicable to electric two-wheelers registered on or after June 1, 2023.

The Ministry of Heavy Industry has notified these changes. The demand incentive for electric two-wheelers will be Rs 10,000 per kilowatt hour. The incentive limit for electric two-wheelers will now be 15 percent of the factory price of the vehicles, which was earlier 40 percent. After this decision of the government, the pockets of those who buy electric two-wheelers will be affected, because now they will get less subsidy.

The Faster Adoption and Manufacturing of Electric and Hybrid Vehicles (FAME) India scheme was launched on April 1, 2019, for three years. Later it was further extended till March 31, 2024. The total outlay for FAME Scheme Phase II is Rs 10,000 crore to provide incentives to buyers of electric vehicles for wider adoption, which can be incentivized as purchase price. The scheme is exclusively for public and commercial transport in the segments of electric three-wheelers, electric four-wheelers and electric buses.

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