India (Commonwealth) _ The Indian government is considering pushing the sale of over a million electric two-wheelers through its flagship incentive scheme in the current fiscal year, and is prepared to increase funds if necessary.
The Centre already has a rolling plan in place to subsidize 564,000 electric two-wheelers as part of the second iteration of the Faster Adoption and Manufacturing of Electric Vehicles (FAME II) initiative, and it is seeking to increase this number by another half a million.
Following an upward revision in subsidy that swiftly drained the allocation, the government upped the subsidy allocation for electric two-wheelers by 75% to Rs 3,500 crore last quarter, up from Rs 2,000 crore in the budget.
We have lately allocated an additional Rs 1,500 crore and will enhance the amount if necessary. A top government official stated that the government will take all necessary steps to promote the transition to emobility. In the previous fiscal year, sales of electric two-wheelers nearly tripled to 727,000 units. In FY23, the FAME II scheme subsidized more than 40% of these purchases. To far, the government has supported the sale of approximately 690,000 electric two-wheelers under the scheme.
To support a greater number of vehicles, the subsidy per unit for electric two-wheelers has been cut. Electric two-wheelers would now receive a 15% subsidy on the ex-factory price, down from 40% under the modified policy. This will result in more expensive ebikes for end users, while manufacturers will benefit from increased production. According to estimates, approximately 46,000 electric two-wheelers were sold last month, compared to a monthly average of 60,000 units sold in the previous fiscal year. According to the official, there was some impact on sales last month as dealers shifted inventory ahead of the June 1 price increase. Over the last two years, customer awareness of electric vehicles has increased dramatically. Sales will improve in the next months.
This expansion plan comes as the government has decided to take action against a half-dozen electric two-wheeler manufacturers who are accused of submitting fraudulent documentation and wrongfully claiming subsidies worth Rs 469 crore while failing to meet localization standards.
