Prime Minister’s E-Drive scheme was launched in 2019 with a planned allocation of Rs 109 billion

The Indian federal government has launched a new scheme called PM E-Drive Innovative Automotive Improvement Revolution (PM E-Drive). The scheme replaces the second phase of the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles (FAME) scheme which ended in March 2024.

The two-year PM E-Drive scheme, with a total investment of Rs 10,900 crore, aims to promote electric vehicles in India, with a focus on incentivizing the development of electric two-wheelers (e-2W), electric three-wheelers (e-3W), electric trucks and buses, and electric ambulances. Of the total investment, Rs 3,679 crore has been allocated for subsidies/demand incentives to support the above-mentioned electric vehicles, of which 24.79 lakh are e-2W, 3.16 lakh are e-3W, and 14,028 are electric buses.

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Apart from this, the Prime Minister E-Drive will incentivize 88,500 electric vehicle charging stations to boost electric vehicle charging infrastructure in India. In addition, the Department of Heavy Industries has allocated Rs 2,000 crore for the installation of 22,100 electric four-wheeler fast chargers, 1,800 electric bus fast chargers, and 48,400 electric two- and three-wheeler fast chargers. However, electric or hybrid passenger cars are still not included in the scheme. More details are yet to be announced.

Fame II: A Review

To give a brief background, FAME Phase II was launched in 2019 with an initial outlay of Rs 10,000 crore for three years, which expired in 2022, but was later extended till March 2024 with an additional outlay of Rs 1,500 crore. The scheme was initially intended to support 1 million electric two-wheelers, 500,000 electric three-wheelers, 55,000 passenger cars and 7,000 electric buses.

After FAME II expired in March 2024, the Indian government launched the EMPS (Electric Vehicle Promotion Scheme) 2024. EMPS 2024 was initially valid for four months (April 1 to July 31, 2024) and was later extended for another two months (until September). The scheme was launched on April 1 with a total outlay of Rs 500 crore and is primarily applicable to commercially registered electric two-wheelers and three-wheelers, as well as registered electric two-wheelers owned by private individuals or companies.

Also read: FAME III is coming soon and will replace EMPS 2024

FAME III is expected to be launched “in a month or two” after the current EMPS scheme expires, for which the budget was increased by Rs 778 crore in July 2024. While it is yet to be confirmed, market reports suggest that FAME III may require a total of Rs 2,000 crore for the development of EV infrastructure, including charging stations.