Thursday, 11 Sep, 2025
A Phased Manufacturing Programme (PMP) is also introduced by the scheme to increase domestic manufacture of EV components. Image Source: IANS
In order to promote cleaner and more sustainable mobility, the PM E-DRIVE Scheme seeks to expedite the adoption of EVs and develop necessary charging infrastructure throughout the nation.
In order to accelerate the Electric Vehicle (EV) adoption in the country, the government on September 29, 2024 launched the scheme titled ‘ PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE). The scheme has a financial outlay of ₹10,900 crore over a period from October 1, 2024 to March 31, 2026. In order to promote cleaner and more sustainable mobility, the PM E-DRIVE Scheme seeks to expedite the adoption of EVs and develop necessary charging infrastructure throughout the nation.
The Ministry of Heavy Industries (MHI) created e-vouchers as part of the program so that EV users could take advantage of demand incentives. The e-vouchers make it easier to obtain rewards and offer a smooth experience for both producers and customers. A live demonstration of dealers creating e-vouchers for customers took place throughout the event.
A Phased Manufacturing Programme (PMP) is also introduced by the scheme to increase domestic manufacture of EV components. In order to be eligible for subsidies, EV chargers will need to fulfill a minimum 50 percent domestic value addition (DVA) criterion starting in December 2024. By 2025–2026, financial assistance for electric two-wheelers would be cut in half to ₹5,000 per vehicle, while subsidies for three-wheelers will be limited to ₹25,000 per vehicle.
What are the benefits under the PM E-DRIVE scheme?
Subsidies/Demand Incentives: ₹3,679 crore allocated for e-2Ws, e-3Ws, e-ambulances, e-trucks, and emerging EVs, supporting 24.79 lakh e-2Ws, 3.16 lakh e-3Ws, and 14,028 e-buses.
E-Voucher Introduction: Aadhaar-authenticated e-vouchers for EV buyers, generated at purchase and sent to registered mobile numbers. Signed e-voucher essential for dealer submission and OEM reimbursement.
E-Ambulances: ₹500 crore allocated for deployment. Standards will be set in consultation with MoHFW and MoRTH.
E-Buses: ₹4,391 crore for procurement of 14,028 e-buses via CESL in 9 major cities. Preference to buses replacing scrapped STU buses.
E-Trucks: ₹500 crore for incentivizing e-trucks, with scrapping certificates from RVSF mandatory for incentives.
Public Charging Stations: ₹2,000 crore outlay for installing 22,100 fast chargers (e-4Ws), 1,800 for e-buses, and 48,400 for e-2Ws/3Ws in high EV penetration cities and highways.
Test Agency Modernization: ₹780 crore for upgrading MHI test agencies to handle new EV technologies.
The government has taken a number of steps towards boosting the sales of electric vehicles and promoting e-mobility in the country. The electric vehicle market in India has come a long way from a sale of 7,772 units in 2015 to more than 1.5 million in 2023. The highest year-on-year growth in the sale of EVs in the country was recorded in 2016 at 531.22 percent. The EV sales jumped from 7,772 in 2015 to 49,065 in 2016. The rise in product availability in the market, the high cost of petrol, diesel, and compressed natural gas, as well as state subsidies and incentives provided under FAME II scheme, are all factors that contributed to the domestic EV industry's sales growth in 2022.
Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME II), is a scheme launched by the Government of India to give a boost to development of Electric Vehicles. The Central Government has allocated a budget of ₹10,000 crore for the second phase of this scheme. The scheme was launched to achieve the goals of the National Electric Mobility Mission Plan (NEMMP). Phase I lasted from 2015 to 2019 and Phase II of FAME was launched in 2019. Government approved a new scheme -'Electric Mobility Promotion Scheme (EMPS) 2024' with a budget of ₹500 crore from April 1 to July 31 after the expiry of FAME 2. The Electric Mobility Promotion Scheme (EMPS) 2024 was extended by two months, from July 31 to September 30, 2024 with a budgetary outlay of ₹278 crore.
Apart from the above mentioned schemes, The Government on September 15, 2021 approved the PLI Scheme for Automotive Sector with a budgetary outlay of ₹25,938 crore to support domestic manufacturing of vehicles. Electric vehicles are covered under this PLI scheme. Also, the Government on May 12, 2021 approved a Production Linked Incentive (PLI) Scheme for manufacturing of Advance Chemistry Cell (ACC) in the country. The total outlay of the scheme is ₹18,100 Crore for a period of 5 years. The scheme envisages establishing a competitive ACC battery manufacturing set up in the country (50 GWh).
The chart below shows the sale of electric vehicles in last few fiscals in the country-
Source: Society of Manufacturers of Electric Vehicles
By 2030, India wants to increase the percentage of sales of electric vehicles (EVs) to 30 percent for individual cars, 70 percent for commercial vehicles, 40 percent for buses, and 80 percent for two- and three-wheelers. This corresponds to the audacious goal of 80 million electric vehicles (EVs) on Indian roads by 2030. Furthermore, India's 'Make in India' campaign aims to achieve total local EV production.
The market for electric vehicles was estimated to be worth $255.54 billion worldwide in 2023. It is anticipated to increase at a noteworthy CAGR of 23.42 percent from 2024 to 2033, reaching roughly $2,108.80 billion by that time.
India's sales of electric vehicles increased significantly by 49.25 percent in 2023 to reach 1.52 million units. Although the industry is still young, it is gaining momentum gradually. The Indian EV market is expected to grow at a 66.52 percent CAGR from $3.21 billion in 2022 to $ 113.99 billion by 2029, according to Fortune Business Insights.
Globally, the trend toward electric vehicles will open up new markets for auto providers. It is anticipated that the Indian market for EV batteries will grow from $16.77 billion in 2023 to an astounding $27.70 billion by 2028.
Regarding infrastructure, as of June 2024, there are 16,344 functioning public electric vehicle charging stations across the country. Maharashtra leads the country in this regard, followed by Delhi and other states. According to a recent Confederation of Indian Industry (CII) assessment, in order to support the exponential growth of electric vehicles, India would need to create at least 1.32 million charging stations by 2030, needing more than 4,00,000 installations every year.
The government is taking a number of steps towards building a robust EV industry but at the same time the government and the EV OEMs also need to address challenges like range anxiety, high costs and issues related to the charging infrastructure.
