The Indian government has announced a reduction in subsidies for electric two-wheelers as part of the FAME-2 (Manufacturing and Faster Adoption of Electric Vehicles in India) scheme.
This new policy will be effective for electric two-wheelers registered on or after June 1, 2023. The Ministry of Heavy Industry has issued a notification regarding these changes.
Under the revised scheme, the demand incentive for electric two-wheelers will be set at Rs 10,000 per kilowatt hour.
Moreover, the subsidy limit for electric two-wheelers will be reduced to 15 percent of the factory price of the vehicles, compared to the earlier rate of 40 percent.
The FAME-2 scheme was initially launched on April 1, 2019, for a three-year period and was subsequently extended until March 31, 2024.
Government Promotes Electric Vehicles
Governments worldwide are making significant investments in EV charging infrastructure, addressing concerns about running out of charge and getting stranded while driving.
Even in India, along with other developed nations, electric two-wheelers have been given priority to improve transportation in densely populated cities.
The Indian government has set a target to transform the traditional automotive industry into an electric automobile industry, with a goal of selling 22 million EVs by 2030.
One of the key advantages of electric vehicles is their lower maintenance cost, which can be up to 60 percent cheaper compared to conventional fuel-based vehicles.
This reduction in costs brings down the overall expense of electric vehicles to just 12 paise per kilometer.
Both the central and state governments are actively promoting the use of electric vehicles, leading to an increasing trend among customers to adopt EVs.
This allows them to take advantage of benefits such as electric vehicle subsidies and reduced road taxes.