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Over 7.45 lakh EVs supported by way of demand incentive amounting to about Rs3,200 cr: Centre

SAURAV ANAND, NEW DELHI : The central government on Tuesday informed that over 7.45 lakh electric vehicles (EVs) have been supported by way of demand incentive under the second phase of FAME India scheme.

Replying to a question in the Lok Sabha, Minister of State for Heavy Industries, Krishan Pal Gurjar, said, “Under Phase-II of FAME India Scheme, 7,45,713 Electric Vehicles have been supported till 07.12.2022 by way of Demand Incentive amounting to about Rs. 3,200 crore.”

Further, Ministry of Heavy Industries has sanctioned 6315 e-buses to 65 cities/STUs/CTUs/ State government entities for intracity and intercity operations across 26 states/UT under the Scheme.

The government notified Phase-II of Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) Scheme for a period of five years commencing from April 1, 2019 with a total budgetary support of 10,000 crore. 

This phase mainly focuses on supporting electrification of public & shared transportation and aims to support through demand incentive 7090 e-Buses, 5 lakh e-3 Wheelers, 55000 e-4 Wheeler Passenger Cars and 10 lakh e-2 Wheelers. 

Under this scheme, incentives are provided to buyers of electric vehicles in the form of an upfront reduction in the purchase price of electric vehicles. 

From June 11, 2021, demand incentive under Phase II of FAME India Scheme has been increased to 15,000/KWh from 10,000/KWh with an increase in cap from 20-40% of the cost of vehicle. This made the cost of electric two-wheelers at par with that of ICE two-wheeler vehicles. Also, since June 25, 2021, Phase II of FAME India scheme was extended for a period of two years up to March 31, 2024. 

The government on May 12, 2021, approved the Production Linked Incentive (PLI) Scheme for manufacturing of Advance Chemistry Cell (ACC) in the country in order to bring down battery prices. The drop in battery prices will result in cost reduction of electric vehicles.

“Electric Vehicles are covered under Production Linked Incentive (PLI) scheme for Automobile and Auto Components, which was approved on 15 September 2021 with a budgetary outlay of Rs. 25,938 crore for a period of five years,” it said.

Also, GST on electric vehicles has been reduced from 12% to 5%; GST on chargers/ charging stations for electric vehicles has been reduced from 18% to 5%.

Ministry of Road Transport & Highways (MoRTH) issued a notification advising states to waive road tax on EVs, which in turn will help reduce the initial cost of EVs.

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