"A Scheme under the National Electric Mobility Mission 2020 has been proposed for Expenditure Finance Committee and Cabinet. The scheme is to be approved by EFC and cabinet," Deputy Heavy Industries Minister P Radhakrishnan said in a written reply to the Rajya Sabha.
The Mission plan projects a potential for 6-7 million units of new vehicles sales of Electric Vehicles (EVs), along with resultant fuel savings of 2.2-2.5 million tonnes that can be achieved by 2020.
The Mission Plan 2020 envisages demand incentive scheme for faster adoption of Electric Vehicles. An inclusive approach has been proposed in the scheme and all vehicle segments come under the purview of the incentive scheme, along with the complete range of electric and hybrid vehicles (Mild, Strong, Plug-in, BEV variants are covered).
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According to industry estimates, if the cost of internal combustion engine car is Rs 5 lakh and that of electric vehicle is Rs 6.5 lakh, the government intends to offer 35 per cent of differential cost. In case of two-wheelers, it could be higher.
They estimate that if India's electric vehicle market takes off, Rs 40,000 crore worth of fuel will be saved.
On March 31, 2012, the Ministry of New and Renewable energy (MNRE) ended a scheme under which 20 per cent subsidy was offered to consumers on purchase of electric four-wheelers and two-wheelers. Under the scheme, the MNRE provided a cash subsidy of Rs 4,000-5,000 on electric two-wheelers and of Rs 1 lakh on electric cars.