Indian government plans to offer Rs 1.45 lakh subsidy for each electric vehicle with a cap of 20% of the total cost.
Electric vehicles in India are about to receive a subsidy of Rs 1.4 lakh each from the government. The subsidy amount could go to Rs 4 lakh for high-end electric vehicles and highest capping will be 20% of the total cost of the EV. This subsidy will be offered to the electric vehicle buyers under the FAME-II scheme that is scheduled to launch in September 7, 2018.
Electric vehicles in India are still very low in numbers and the government wants to boost the sales by encouraging customers with the FAME-II scheme. This comes as part of the Indian government’s strategy to drive the country towards zero emission pure electric mobility by the end of next decade. Previously, Rs 700 crore was allocated in the FAME-I scheme and the number is expected to be around Rs 5,500 crore, eight fold higher in the FAME-II.
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In the FAME-II scheme, hybrid vehicles and trucks have been excluded, emphasising particularly on electric cars and two-wheelers. Another interesting fact about the subsidy under FAME-II scheme is the way the amount will be decided. For each kilowatt hour (KwH) the subsidy amount will be Rs 10,000. With the current electric vehicles in India being powered by 14 KwH batteries, the subsidy will be Rs 1.4 lakh at least.
To promote the electric vehicles in India, NITI Aayog has been pitching on subsidy for electric vehicles, local production of electric vehicle batteries. These steps will boost the electric vehicle mobility in the country. Government owned agency EESL has already ordered a huge 10,000 units of electric vehicles for the usage by various government agencies and ministries. While the number of sales of electric vehicles in India is still very low compared to the conventional fuel powered models, the number has been increasing steadily in recent years.