India introduces new EV subsidy scheme

India has launched a new scheme to fund electric vehicles called PM Electric Drive Revolution In Innovative Vehicle Enhancement (PM E-DRIVE). It reserves funds for electric two- and three-wheelers, as well as commercial vehicles and infrastructure. But not for passenger cars.

The scheme will run for two years and has a total budget of 109 billion rupees (about 1.3 billion euros). It will finance 2.48 million electric two-wheelers, 316,000 electric three-wheelers, and 43.91 billion rupees have been reserved to fund 14,028 electric buses.

“The demand aggregation [for electric buses] will be done by CESL in the nine cities with more than 40 lakh population namely Delhi, Mumbai, Kolkata, Chennai, Ahmedabad, Surat, Bangalore, Pune and Hyderabad. Intercity and Interstate e-buses will also be supported in consultation with states,” the government said in a statement.

Another five billion rupees have been earmarked for the purchase of electric ambulances and 500,000 for electric trucks. In case of the latter, “incentives will be given to those who have a scrapping certificate from MoRTH approved vehicles scrapping centres (RVSF),” the Indian government announced.

Moreover, 88,500 new EV chargers will be set up under the scheme. These will be installed in selected cities and along highways. Specifically, the government plans to install 22,100 DC fast-chargers for electric cars, 1,800 chargers for electric buses, and 48,400 public chargers for two- and three-wheelers. The total budget for this undertaking is two billion rupees.

As mentioned above, electric passenger cars are no longer subsidised under the new programme. They had been under the national eMobility subsidy programme FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles), which ran until May 2024. Incidentally, hybrids of any kind are no longer on the list.

“The primary objective of the PM E-DRIVE scheme is to expedite the adoption of EVs by providing upfront incentives for their purchase, as well as by facilitating the establishment of essential charging infrastructure for EVs,” the government states in its press release. “The PM E-DRIVE scheme aims to promote EVs to reduce the environmental impact of transportation and improve air quality.”

In addition to the E-DRIVE scheme, India also approved the PM-eBus Sewa-Payment Security Mechanism scheme. It has a budget of about 34.35 million rupees (about 371.5 million euros) to fund more than 38,000 electric buses by 2028/2029.

Update 1 October 2024

Applications for the new eMobility subsidy programme PM E-DRIVE are now open in India. The programme aims to accelerate the introduction of electric vehicles in the country, with a focus on electric two- and three-wheelers. However, part of the budget is also earmarked for electric buses. The total expenditure of 109 billion rupees is spread over two years, with 504.7 billion rupees allocated for the 2024/25 financial year and 585.3 billion rupees for the 2025/26 financial year.

autocarpro.in, economictimes.indiatimes.com, pmindia.gov.in, businessinsider.in, pmedrive.heavyindustries.gov.in (both update)