Amid uncertainty around the continuity of incentives for electric vehicles, the new Minister of Heavy Industries HD Kumaraswamy said the third leg of the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicle (FAME) scheme is in the works and is in the final stages. The scheme is unlikely to be announced in the upcoming union budget.
“FAME 3 preparatory work is going on. All seven ministries have sent their recommendations on implementing the FAME program. It is going to be implemented in the coming days,” Kumaraswamy said while talking to reporters on the sidelines of an industry event today.
The minister, however, refrained from giving an exact timeline for the launch of the new scheme. When asked if FAME 3 will be part of the upcoming union budget, the minister said: “No, it is in the final stages.”
The third phase of the FAME scheme will replace the temporary Electric Mobility Promotion Scheme (EMPS) 2024, which is set to expire by the end of July.
The EMPS scheme, valid for four months from April 1 to July 31, was launched with a total outlay of Rs 500 crore after the FAME 2 scheme expired on March 31 to ensure continuity in incentives for electric two and three-wheelers.
The FAME 2 scheme was rolled out in 2019 with an outlay of Rs 10,000 crore for three years ending in 2022 but was extended to March 2024. The initial target of the scheme was to support 10 lakh electric two-wheelers, 5 lakh electric three-wheelers, 55,000 passenger cars, and 7,000 electric buses.
Several new-age OEMs, particularly two-wheeler ones, and industry bodies have been pushing the government for a continuity in subsidies. The demand subsidy given under the scheme has been instrumental in driving the early-stage adoption of electric vehicles in the country.