Government plans to offer Rs 1.4 lakh subsidy on electric vehicles
The government has announced a major step to boost uptake of electric vehicles by offering a subsidy of Rs 1.4 lakh on the purchase of each EV. A report states that the ceiling on this subsidy has been fixed at 20 per cent of the value of the electric vehicle. This would mean that owners of high-end electric cars, which may soon be available in the market, could receive maximum subsidy of up to Rs 4 lakh, according to the report. The first beneficiaries of the subsidy will be buyers of Tata and Mahindra EVs already available in the market. Not just cars, the subsidy benefits will also be extended to buyers of electric two-wheelers and three-wheelers.
This decision was taken at a meeting on August 23, and soon after it, the ministry of finance has decided to raise allocation of subsidy on EVs to Rs 4,500 crore under phase 2 of the Faster Adoption and Manufacturing of Electric (and Hybrid) vehicles (FAME) scheme.
A high-powered committee for FAME has decided to allocate an additional Rs 1,000 crore for setting up charging infrastructure, taking the total fund allocation to Rs 5,500 crore. The government has a target of increasing the share of electric vehicles in the market from the current one per cent to 40 per cent by 2030.
As of 2016-17, there were 2,000 electric cars in India as against three million conventionally-fuelled ones, while there were about 23,000 electric two-wheelers out of a total market of 16 million. Just a day earlier, we wrote about Jaguar announcing that its famed E-type would make an electric comeback as the Jaguar E-type Zero, powered by an I-Pace electric powertrain.