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Fame-2 incentive scheme for electric vehicles extended by two more years

Department of Heavy Industry had launched a scheme, Faster Adoption and Manufacturing of Hybrid & Electric Vehicles in India (FAME India), for the promotion of electric and hybrid vehicles with an outlay of Rs.795 Crore. Phase I of the FAME India Scheme was initially approved for a period of 2 years, commencing from 1st April 2015. The scheme has been extended from time to time. Previously it was extended up to 31st March 2019 and with an enhancement in outlay from Rs. 795 Crore to Rs. 895 Crore. Accordingly, after reviewing of phase I, the Department of Heavy Industry formulated the Phase II of the scheme (FAME India Phase II) with the approval of the Union Cabinet as per the scheme parameters.

FAME India Phase II scheme states “The scheme is proposed to be implemented over a period of 3 years, from April 2019, for faster adoption of electric mobility and development of its manufacturing eco-system in the country”. Now with the approval of the competent authority, it is decided that the FAME India Phase II scheme is extended for a period of two years to 31st March 2024.

The FAME II scheme, introduced to drive greater adoption of EVs in India, was launched to support 7,000 e-buses, 5,00,000 e-three-wheelers, 55,000 e-passenger vehicles and a million e-two-wheelers. However, it seems to have missed its desired outcome by a huge count.As of June 26, 2021, only 78,045 vehicles have benefited under the scheme. In reality, though, due to the high localization norms and other rules, most of the products in the segment did not qualify for the incentives. The ones that qualified did not get enough subsidies to close the price gap with combustion engine vehicles.

One of the criticisms from the electric two-wheeler industry was that the FAME II scheme focused on high-speed electric two-wheelers, as against their regular siblings.

FAME II scheme extended:  What’s new? 

In what is a boon for new electric two-wheeler customers, the scheme has increased the demand incentive by 50 percent to Rs 15,000 per kWh compared to Rs 10,000 per kWh earlier. The maximum cap is also increased to 40 percent of the e-two-wheeler cost compared to 20 percent earlier. The ministry of heavy industries has also mandated Energy Efficiency Services Ltd (EESL) to procure 300,000 electric three-wheelers for use by different authorities.

The public sector unit has been given the responsibility to procure electric buses for deploying across cities.

Government sources said that they were also looking at including electric bicycles under the capital subsidy scheme seeing its growing popularity and the need to bring down its cost for customers.
The fresh inclusions would make the running Fame II or Faster Adoption and Manufacturing of Hybrid and EV scheme all-encompassing covering the entire range of electric vehicles being used both for personal and commercial use and public transport.




About The Indian Iris

Just like an iris controls the light levels inside the eye making it possible for us to see the outside world, The Indian Iris aims at shedding light on the ongoing political affairs, policies and schemes of the Government of India (GOI) and those of the State Governments.

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