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The Ministry of Heavy Industries has approved 11 electric vehicle (EV) manufacturers, including Ather Energy, Bajaj Auto, Hero MotoCorp, Ola Electric, and Mahindra, to receive incentives under the recently introduced Electric Mobility Promotion Scheme (EMPS) 2024.
"A total of 11 firms have been granted approval under the EMPS, with several more under consideration,” informed a senior official of the ministry to Business Standard.
The scheme aims to sustain the growth in EV sales, replacing the Faster Adoption and Manufacturing of Electric Vehicles – II (FAME-II) scheme.
The new scheme, with an allocation of Rs 500 crore, commenced on April 1 and will continue till July 31.
Other EV manufacturers getting the approval were TVS Motor, Quantum Energy, Hop Electric, Kinetic Green, BGauss Auto and TI Clean Mobility.
The Centre has streamlined the certification process for this scheme.
“The approval process is now more efficient and expedited, ensuring a seamless experience for applicants,” said the official.
Earlier, concerns had been raised by EV companies about potentially missing out on incentives for sales made post-April 1.
However, companies that have received approval will be eligible for incentives from their respective approval dates.
Applications from automakers are still being accepted.
Officials have indicated that all applicants seeking incentives under the upcoming scheme must undergo a registration process.
To manage the increasing demand and lessen the burden on EV manufacturers, the government has reduced the maximum subsidy cap.
For electric two-wheelers (e2W), the cap is now Rs 10,000 per vehicle, down from Rs 22,500, and for e3W, it is Rs 50,000, reduced from Rs 111,505.
Both categories will receive incentives of Rs 5,000 per kilowatt-hour (kWh).
“The subsidy reduction responds to the high demand.
"The goal is to support the industry while preparing it for a post-subsidy era, as subsidies cannot continue indefinitely,” heavy industries minister Mahendra Nath Pandey told Business Standard.
Incentivising e2W & e3W
Though incentives are offered for e2W and e3W categories, no such benefits are extended to electric four-wheelers (e4W) and e-buses under the new scheme.
Despite requests from several e4W manufacturers, including industry leader Tata Motors, for a three-year extension of FAME-II benefits to their category, this request was not approved.
Government officials explained that the exclusion of e4W and e-buses from the EMPS is due to existing schemes like Auto PLI and PM-eBus Sewa Scheme catering to these categories.
“The Auto PLI and PM-eBus Sewa scheme already cater to e4W and buses. Currently, EMPS will focus solely on e2W and e3W categories,” heavy industries minister had said.
According to government data, FAME-I supported approximately 278,000 pure EVs with total demand incentives of Rs 343 crore.
FAME-II, which began in April 2019 with an outlay of Rs 10,000 crore for three years, was later extended to March 2024.
EV sales this year have seen a significant increase of over 45 per cent, surpassing the challenges of subsidy reductions and regulatory changes.
EV registrations in 2023 nearly reached 1.5 million units, a substantial rise from the previous year’s figure of just over 1 million units.
This growth has propelled the overall EV penetration in India to 6.3 per cent from 4.8 per cent in 2022, exceeding the 5 per cent mark.
