Initiative to Promote e-mobility: Subsidies Offered By the Government on EV Vehicles
Government subsidy on electric vehicles
The cost has been one of the most significant impediments to the adoption of electric vehicles. The vehicle industry of the country has always relied on the internal combustion engine because of the lack of infrastructure. But now with the advancement of technology things are changing and so is the demand for vehicles that don’t consume fuel which is creating pollution. These days electric vehicles are becoming more accessible and people are shifting towards it, and all credit goes to the initiatives taken by the Indian Government to promote e-mobility in the market. Each state’s EV policy makes them even more affordable and this provides impetus to the transitions. Under the national FAME-II scheme, the central government offers sops.
The most important part of the scheme is that each state has its set criteria to provide subsidies for electric vehicles. Hence the benefits of this also vary and in some areas, it is quite large. This brings EVs closer to becoming the mainstream option for buyers. You can have a look at the subsidy provided by the state for buying electric vehicles. Here we have the subsidies provided by the state government for the two-wheeled electric vehicles.
Subsidies for electric two-wheelers from the state
State-specific EV policies have been developed for a period of four to five years from the date of notification, and will only subsidize a small number of vehicles. Most Indian states have decided to allocate subsidies for electric two-wheelers (that qualify for incentives under the FAME-II scheme) based on the size of their lithium-ion battery packs in their EV policies. Only two states offer subsidies based on a different basis than the incentive amount, which is determined on a ‘per kWh of battery capacity’ basis. Let’s have a look at the criteria under which subsidy is offered by the individual states of India.
Delhi leads the way in terms of the highest subsidy available, with a Rs 5,000 per kWh incentive and a maximum of Rs 30,000 (battery has a capacity greater than 5 kWh). Maharashtra is currently ranked second on the list, with a subsidy of Rs 5,000 per kWh and a total subsidy of Rs 10,000. The total subsidy for any electric two-wheeler with a 3 kWh (or larger) battery would be Rs 25,000, thanks to an early bird incentive (of up to Rs 15,000; valid only until December 31, 2021).
- Meghalaya, Assam, Gujarat, and West Bengal have a higher per-kWh subsidy of Rs 10,000, with a total subsidy of Rs 20,000 available.
- Bihar’s electric vehicle policy, which has yet to be approved, offers similar benefits.
- Rajasthan offers a Rs 5,000 subsidy for two-wheelers with a 2 kWh battery and a Rs 10,000 subsidy for those with a battery larger than 5 kWh.
- Odisha, on the other hand, offers a Rs 5,000 flat subsidy.
Andhra Pradesh, Karnataka, Madhya Pradesh, Telangana, Tamil Nadu, Uttarakhand, Punjab, and Uttar Pradesh do not provide direct subsidies to electric two-wheeler buyers.
In most states where the policy has been implemented, road tax for electric vehicles is completely waived, with the exception of Gujarat and Kerala, where buyers must pay half of the total road tax amount.
Meanwhile, registration fees for all types of electric vehicles have been waived across the country. The Ministry of Road Transport and Highways (MoRTH) announced in August that all battery-powered vehicles are exempt from “fees to issue or renew registration certificates.”
If you are looking to switch to electric vehicles to make them cost-effective and also to save the country from pollution, then you must check out the subsidy offered by the government in your state.