BUSINESS: Union Heavy Industries Minister H D Kumaraswamy reiterated that the third phase of the Faster Adoption and Manufacturing of Electric (and Hybrid) Vehicles – FAME-III – could be announced in two months, assuring the country’s electric vehicle manufacturers that subsidies will continue to be provided to boost the growth of the sector. Until the new flagship programme is notified, subsidies for green-powered vehicles through the government’s Electric Mobility Promotion Scheme (EMPS) will continue, which will be extended for another two months, Kumaraswamy said on the sidelines of the Automotive Component Manufacturers Association (ACMA) conference in the national capital on Monday.
“We are discussing it,” Kumaraswamy said. “Till FAME-III is announced, we will extend EMPS for another two months… We are trying to plug all the loopholes found in FAME II.” FAME-II expired in March and EMPS was introduced in its place to stay until the implementation of FAME-III. EMPS was expected to end in July, but the central government extended it till the end of September with an additional outlay of Rs 778 crore.
Under FAME and EMPS, consumers can buy EVs from manufacturers at a subsidized price. The government reimburses the manufacturers by paying the difference. These subsidies are crucial for the growth of the EV market in the country and encourage consumers to adopt vehicles powered by green energy sources. Data shows that EV purchases are declining. According to data from the Ministry of Heavy Industries in August 2023, only 5.28% of two-wheelers sold in India since 2018 were electric models, while 1.99% of four-wheelers sold were electric.
