New Delhi, March 15, 2024: The Ministry of Heavy Industries announced the Electric Mobility Promotion Scheme (EMPS) 2024 , to accelerate faster adoption of electric two wheelers and three wheelers in the country. With an outlay of Rs 500 crore for four months beginning April 2024 to July 2024, the new scheme was announced by Heavy Industries Minister Mahendra Nath Pandey as the FAME -II scheme expires on March 31, 2024. Of the total outlay of Rs 500 crore, Rs 493.55 crore has been earmarked for subsidies for electric two-wheelers and three-wheelers, while Rs 6.45 crore has been set aside for the administration of the scheme. The EMPS will be beneficial for e-2W and e-3W categories registered by fleet operators and companies owning electric vehicles. Under the scheme, a subsidy of Rs 10,000 per two wheeler will be provided with the objective to subsidise 3.3 lakh two wheelers during this four month period.
While L3 category three wheelers will get a subsidy of Rs 25,000 and will be extended to nearly 13000 vehicles. (e-rickshaw & e-carts). However L5 category three wheelers will get a subsidy of Rs 50,000 per vehicle which will be extended to roughly 25000 vehicles during this period. The government also announced that that subsidies under FAME-II will be eligible for e-vehicles sold till March 31, 2024, or till the time funds are available whichever comes first.
Commenting on the EMPS 2024 Chairman of Sona Comstar and the Deputy Chair, CII Northern Region, Sunjay Kapursaid "The approval of the new E-Vehicle policy marks a pivotal moment in our nation's mobility landscape. This progressive step not only solidifies India's position as a manufacturing hub for EVs but also fosters a conducive environment for global players to invest in our burgeoning market.
With a minimum investment threshold and a clear roadmap for domestic value addition, this policy underscores the government's commitment to nurturing a robust EV ecosystem. It heralds a new era of innovation and accessibility to cutting-edge technology and amplifies the 'Make in India' initiative. By incentivising local manufacturing and fostering healthy competition, this policy will not only accelerate the adoption of EVs but also bolster economic growth by way of reducing our reliance on imported crude oil and mitigating environmental impact, particularly in urban areas.”
Dinesh Arjun- Co-founder and CEO at Raptee said “The recent announcement of the Electric Mobility Promotion scheme represents a positive step towards continuing support to accelerate the adoption of electric vehicles (EVs). This timely initiative comes as the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme draws to a close by 31st March 2024, providing a crucial 4-month transition period for the industry to stabilize.
Going by the long-term objective of self-sustenance of the EV industry, the Government has been gradually reducing the FAME subsidy. The last reduction was in May 2023, and the balance funds available were distributed for the vehicles sold till March 2024. The current FAME subsidy is around ₹22,500 per two-wheeler until 31st March 2024. From 1st April 2024, the Electric Mobility Promotion scheme kicks in with a further reduced subsidy of Rs. 10,000 per two-wheeler till July end. This sends a clear signal that, while the FAME scheme cannot be extended, the Government is here to ensure a smooth transition to a self-sustainable business model by the OEMs. This move reflects a pragmatic approach towards gradually weaning the industry off heavy subsidies, allowing it to sustain itself over the long run".
While the subsidy reduction may seem challenging in the short term, it ultimately serves to prevent any sudden shocks to the industry and encourages manufacturers to innovate and offer better products and value propositions to justify the price consumers are paying. By fostering a more sustainable and self-reliant ecosystem, the EV industry can chart a course towards long-term viability and resilience.
In essence, this transition signifies the progress of the EV market, where government support also evolves from subsidies to strategic incentives aimed at fostering innovation and charging infrastructure development. It underscores a commitment to sustainable mobility solutions while also ensuring the industry's ability to thrive independently in the years to come.
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