Home Business News FAME 3 To Launch With Rs 10,000 Crore For EV Incentives: Report

FAME 3 To Launch With Rs 10,000 Crore For EV Incentives: Report

India’s flagship electric vehicle incentive program, Faster Adoption and Manufacturing of Electric Vehicles (FAME), is set to enter its third phase with an estimated outlay of Rs 10,000 crore. The Economic Times reports that FAME-III is expected to be launched within the first 100 days of the new government taking charge in June.

 Incentives for Electric Vehicles

FAME-III will continue offering financial incentives for purchasing electric two-wheelers, three-wheelers, and government-owned buses. However, a final decision on extending these incentives to electric cars, including those used by taxi aggregators and other institutional buyers, is still pending. 

The new FAME-III scheme will follow FAME-II, which concluded in March 2024. Under FAME-II, a 15% subsidy was provided on the sale price of electric scooters. The proposed FAME-III scheme is expected to be presented to the Union Cabinet for approval shortly after the new government assumes office.

The Electric Mobility Promotion Scheme (EMPS)

Under EMPS, the government provides incentives of up to Rs 10,000 per electric two-wheeler, a reduction from Rs 22,500 under FAME-II, and up to Rs 50,000 per electric three-wheeler, down from Rs 111,505. Both categories receive incentives of Rs 5,000 per kilowatt-hour (kWh). EMPS aimed to support the sale of 372,215 electric vehicles, including 333,387 two-wheelers and 38,828 three-wheelers. The scheme emphasizes advanced technologies by offering incentives only to vehicles equipped with advanced batteries.

The new FAME policy is likely to exclude electric cars for both private and commercial use. In Phase I of the FAME policy, subsidies were provided for electric cars priced under Rs 15 lakh (ex-showroom), making them more affordable. However, private electric vehicles were not included in FAME II, and the same might apply to the upcoming provisions. It is anticipated that the government may shift its focus to incorporating strong hybrid cars in the new FAME policy