Govt Allocates Rs 500cr To Boost Electric Two & Three Wheelers

Govt Allocates Rs 500cr To Boost Electric Two & Three Wheelers

The Ministry of Heavy Industries has now issued a notification to start a new scheme (Electric Mobility Promotion Scheme) especially dedicated to the promotion of electric two and three wheelers. As per the government notification, the scheme will be valid only for four months from April 1, 2024 to July 31, 2024. The ministry has also allocated Rs 500 crore for the scheme.

As per the details given by the ministry, it has planned to support a total of 3,72,215 electric two and three wheelers in total. The ministry notification said that it can allow a maximum of 3,33,387 electric two wheelers, 13,590 electric three wheelers (e-richshaw, e cart) and 25,238 three wheelers (L5 category). 

The notification from the government comes at a time when the validity period of FAME-II scheme is set to lapse on March 31, 2024. The ministry has named the new scheme as Electric Mobility Promotion Scheme, 2024. 

“The Electric Mobility Promotion Scheme- 2024, with an outlay of Rs.500 crore, is proposed to be implemented over a period of 4 months, w.e.f. 1st April 2024 till 31st July 2024, for faster adoption of electric two wheeler (e2W) and three wheeler (e-3W) to provide further impetus to the green mobility and, development of electric vehicle (EV) manufacturing eco-system in the country,” the ministry notification said.

The ministry also asked the states to offer additional support to the segment to boost electric mobility in their regions. “The efforts of the central government to promote e-mobility need supplemental support from State Governments. States need to offer bouquet of fiscal and non-fiscal incentives. Some such incentives may include waiver / concessional road tax, exemption from permit, waiver / concessional toll tax, waiver / concessional parking fees, concessional registration charges, etc. MHI will continue to encourage States to offer such incentives during the scheme duration,” the ministry added. 

The ministry as per their norms proposed a demand incentive of Rs 5,000 per KwH for electric two wheelers and electric three wheeler categories. It also said that the incentive will be capped at 15% of the ex-factory price of the vehicles. In order to avail demand incentive, OEM is required to be registered with MHI. Further, after registration of the OEM, each of their EV models will need to be approved by MHI, the ministry said. 

“The demand incentive shall be disbursed through an e-enabled framework and mechanism set-up under MHI. The manufacturers of vehicles (OEMs or Original Equipment Manufacturers) will submit their claims for reimbursement of demand incentive on monthly basis to MHI for settlement. Detailed guidelines for reimbursement of claim will be issued separately,” the ministry said.