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EV Subsidies in India explained

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Pratik Bhanushali

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EV Subsidies in India explained

Electric two-wheelers are gradually establishing a co-existence with petrol-powered bikes/scooters in India. Now, there are various factors contributing to the EV adoption, like low cost of running, lower rate of pollution and one of the most important factors – subsidies. In India, we have two types of these: Fame II and state subsidy. But what exactly do they account for? How do you avail of them? What’s the amount? Let’s find out. 

FAME II 

Of the two subsidies available in India, FAME II is the standard one and can be availed in any part of the country. FAME stands for Faster Adoption and Manufacturing of Hybrid and EV and was implemented back in 2019. It will be active till 21 March 2024.  

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The basic criteria that an electric two-wheeler should meet for eligibility for the FAME II are: Offer a minimum range of 80km in one charge, clock at least 40kmph of speed and be localized to a certain extent as specified by the government.  

The central government has allocated a Rs 15,000 incentive for per kWh of a battery unit. Theoretically, the Ather 450X benefits from a subsidy of Rs 43,500 and the Ola S1 Pro’s price goes down by Rs 59,550. However, the incentive amount can’t exceed 40 per cent of total cost of the two-wheeler. Not to mention, manufacturers mention the asking price of their two-wheeler including the FAME II benefit.  

State subsidy 

Apart from the FAME II, buyers can also avail of the state subsidies which are available in various parts of India. With that being said, the amount varies as per the state since some of them offer a fixed incentive while others consider the battery capacity.  

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For reference, in the state of Maharashtra, buyers can avail of Rs 10,000 as a fixed incentive on their e-scooter/bike purchase. Moreover, EVs with a battery warranty of 5 years are also fit for an additional incentive of Rs 12,000. 

On the other hand, customers in Gujarat can only benefit from Rs 10,000 per kWh of the battery without exceeding 20 per cent of the total value of the vehicle. 

Buyers will have to submit their Aadhar details and pay the full amount for their EV. The subsidy amount will be then transferred to the customer’s bank account linked with the submitted Aadhar card number.   

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