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If you are planning to buy an electric scooter, then buying an electric scooter may be expensive for you because the government is going to reduce the subsidy on electric vehicles. After the subsidy is reduced, the prices of electric vehicles can increase by about 15 percent. That is, e-scooters can become expensive due to subsidy cuts. With this, the common people of the country will have to loosen their pockets to buy an electric scooter.
Officials said that the government is proposing to reduce the subsidy for electric vehicles from 40% at present to 15% of the selling price to encourage a large number of electric vehicles. If the proposal is passed, it could lead to an increase in the per unit cost for the customers. The Ministry of Heavy Industry (MHI) has sent a recommendation in this regard to a high-level inter-ministerial panel, which will take a final call on the matter.
This is being done to increase the spread of EV two-wheelers as the government will be able to support more vehicles with the available funds. Apart from this, the share of subsidy allocation for three wheelers will also be used for two wheelers.
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Manufacturers get help from this scheme
The central government provides financial assistance to electric vehicle manufacturers under the Rs 10,000 crore Faster Adoption and Manufacturing of Electric Vehicles in India (FAME India) incentive scheme. The total fund allocation for electric two-wheelers under the second phase of FAME India will reach Rs 3,500 crore using the allocation of Rs 1,000 crore for electric three-wheelers. This will be possible by increasing the allocation and reducing the subsidy per unit.
45,000 vehicles are sold every month
Around 5.63 lakh electric two-wheelers have been benefitted from the FAME 2 scheme so far. If the government continues with the per unit subsidy at the current level, the allocation for electric two-wheelers will end in the next two months, despite increasing the stipulated amount. After the subsidy percentage is reduced, 10 lakh electric two-wheelers can be supported by FAME India by February 2024. The officials do not expect any impact on the demand for such vehicles. About 45,000 units of electric two-wheelers are sold every month in the country.
