Ministry of Heavy Industries Considers Extending EV Subsidies
Quick Look
- India's Ministry of Heavy Industries is considering extending subsidies for domestically manufactured electric two-wheelers beyond July 31, requiring additional budgetary support.
- The ₹10,900-crore PM E-Drive scheme has already committed all its funds, but the ₹5,000 per vehicle subsidy is expected to remain unchanged.
AI-generated summary
Why It Matters
The PM E-Drive scheme, launched in September 2024 with ₹10,900 crore, has already committed all its funds, having surpassed sales targets for e2w and e3w.
New Delhi: The Ministry of Heavy Industries is considering extending subsidies for domestically manufactured electric two-wheelers beyond July 31, which would require additional budgetary support as funds under the ₹10,900-crore PM E-Drive scheme have already been committed, officials said.
The quantum of subsidy for domestically manufactured electric-two-wheelers (e2w) is likely to stay the same at around ₹5,000 per vehicle.
India has registered sales of 2.7 million e2w, against the PM E-Drive target of 2.5 million, launched in September 2024. The industry has also sold 297,000 electric-three-wheelers against a target of 289,000.
"Proposals to extend subsidies for e2w are under consideration," a senior official told ET.
The Centre earmarked ₹1,772 crore for subsidising e2w manufactured in the country under the PM E-Drive scheme. According to official estimates, ₹1,259.91 crore was spent for subsidising e2w till March-end. Another ₹907 crore was earmarked for electric three wheelers (e3w) of which ₹737.35 crore was spent. Electric buses have got the largest share of subsidy allocation under PM E-Drive with ₹4,391 crore earmarked in the scheme for deploying 14,028 electric buses across large cities. Of these, the procurement process for 13,800 buses has concluded, comprising 10,900 buses under the first tender and 2,900 buses under the second.
"All funds provisioned in the PM E-Drive scheme have been committed," the official said.
What to Watch
AI outlook — possibilities, not facts
Subsidies for domestically manufactured electric two-wheelers will be extended beyond July 31.
Likely · Within weeks
The subsidy quantum for e2w will remain around ₹5,000 per vehicle.
Very likely · Short term
Open Questions
- What is the new budget allocation required?
- When will a final decision on the extension be made?
- What specific criteria will be used for the extension?
