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Last Updated : Feb 28, 2019 04:09 PM IST | Source: Moneycontrol.com

Govt to offer up to Rs 2.5 lakh subsidy on 60,000 electric cars: Report

Funds will be directed towards making electric two and three-wheeler vehicles more attractive to customers, and buses used for public transport

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The Centre will soon announce a subsidy up to Rs 2.5 lakh for 60,000 electric cars and a dole of Rs 20,000 for 20,000 hybrid cars that are bought in the next three years. The Rs 10,000 crore package will give the green fuel the much-needed push in India.

Sources told The Times of India that most of the funds in this package will be contributed to electric two and three-wheeler vehicles and buses used for public transport. e-rickshaw drivers can also avail this subsidy.

So, after this move is promulgated, someone interested in buying Mahindra E-Verito will get a subsidy of around Rs 1.5 lakh, while a good quality electric two-wheeler can receive a subsidy of Rs 40,000. The subsidies for buses would be up to Rs 60 lakh.

This proposal may be taken up by the Cabinet on February 28 as part of the second phase of Faster Adoption and Manufacturing of (Hybrid and Electric Vehicles) India (FAME) scheme. The government wants to see fast results on the electric vehicles front, therefore, it doubled allocation to the scheme from the earlier Rs 5,500 crore.

This subsidy will come into effect in April. Under this scheme, the government will also cap ex-factory price of a vehicle, except buses, to avail the subsidy, at Rs 15 lakh. The subsidy for any vehicle will be calculated on the basis of its battery capacity — Rs 10,000 per KWh for all vehicles and Rs 20,000 per KWh for buses.

This subsidy will make two and three-wheeler electric vehicles very attractive to customers as it would end up bringing down their costs viz-a-viz petrol vehicles. "There will also be a huge focus on expanding the charging infrastructure in cities and along highways to meet the demand. Another focus area will be on developing our capacity to produce lithium-ion batteries for vehicles," the source told the newspaper.
First Published on Feb 28, 2019 10:11 am
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