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Last Updated : Mar 01, 2019 01:01 PM IST | Source: Moneycontrol.com

FAME II: MoTown welcomes govt’s package to boost electric vehicles

Besides charging stations the government will be setting up seven testing centres across the country for certifying electric vehicles

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Hybrid and electric vehicles (EV) manufacturers have greeted with cheer the 10-fold rise in the assistance package announced by the Centre to promote ‘greener mobility.'

On February 28, the Cabinet Committee of Economic Affairs (CCEA) approved a Rs 10,000 crore package under the second phase of Faster Adoption and Manufacturing of Electric and Hybrid Vehicles (FAME) for three financial years. FAME-I, which had started in 2015, had a total outlay of Rs 895 crore.

Besides providing direct subsidy to buyers of electric vehicles, the total outlay also encompasses setting up of allied ecosystem such as a charging station, technical know-how and testing facilities.

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Shailesh Chandra, President Electric Mobility and Corporate Strategy, Tata Motors, said, “We welcome the government's move on FAME II. It brings clarity and policy stability in the industry, thus creating an environment for all players to commit to the journey of sustainability. We see this as the key intervention in accelerating penetration of electric vehicles and realisation of the government’s Vision 2030.”

Following a steady rise in prices of petrol and a sustained launch of new models, demand for electric two-wheelers have been encouraging for manufacturers. As per data available, nearly 55,000 electric two-wheelers were sold during 2017-18, a growth of 138 percent compared to 2016-17. FAME-I provides incentives ranging between Rs 7,500 to Rs 22,000 on battery powered 2Ws.

Sales of electric cars, however, has shown a sharp dip to 1,200 units during 2017-18, a drop of 40 percent compared to 2016-17. Only two electric cars (e-Verito and E20) are on sale at present and both are from Mahindra & Mahindra (M&M).

Pawan Goenka, Managing Director, M&M, said, “The new outlay of Rs 10,000 crore over a period of three years provides a stable policy to promote green mobility in India. It addresses the key issues including National Energy Security, mitigation of the adverse impact of vehicles on the environment and growth of domestic technology and manufacturing capabilities. The revised FAME II removes all uncertainty and will put adoption of electric vehicles in the fast lane.”

In all, more than 2.65 lakh vehicles were provided support under the FAME I scheme through subsidy, creation of charging stations and providing technological support.

FAME II plans to support 1 million e-two-wheelers, 500,000 e-three-wheelers, 55,000 four-wheelers and 7,000 buses. Around 2,700 charging stations will be established in major cities, cities with million plus population, smart cities and cities in hilly states.

There will be at least one charging station in a grid of 3 km x 3 km. Charging stations are also proposed on major highways on both sides of the road at an interval of around 25 km each.

In February, the Ministry of Heavy Industries and Public Enterprise constituted NATRIP Implementation Society (NATIS), an autonomous body for the execution of National Automotive Testing and R&D Infrastructure Project (NATRIP).

NATIS has been entrusted to set-up state-of-the-art automotive test facilities at seven locations across the country at an investment of Rs 3723.30 crore. The ministry is inviting tenders for the same.

As for actual monetary support, government of India slashed subsidy on electric vehicles for 2019-20 by 25 percent to Rs 195 crore as against Rs 260 crore allotted in the current financial year, as per Union Budget documents.

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First Published on Mar 1, 2019 12:44 pm
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