Heavy industries ministry expects to finalise the modalities for the nation-wide roll out of FAME India scheme before March-end in order to promote the use of eco-friendly vehicles.
The ministry has also asked the finance ministry to extend the 200 per cent incentive for research and development, especially for the automobile sector, in the upcoming Budget.
The government in April 2015 had formally launched the FAME India scheme offering incentives on electric and hybrid vehicles of up to Rs 29,000 for bikes and Rs 1.38 lakh for cars.
"It (the pilot) is a two years project which is competing in March. We are still working on the nation-wide rollout of the scheme. We will be finalising it before March-end. How it will be rolled out and what will be the future of FAME, is yet to be decided," Heavy Industries Secretary Girish Shankar told PTI here.
FAME India - Faster Adoption and Manufacturing of Hybrid and Electric vehicles in India - is a part of the National Electric Mobility Mission Plan. The scheme envisaged Rs 795 crore support in the first two fiscals starting with the current year.
In the Budget for 2015-16, Finance Minister Arun Jaitley had announced an initial outlay of Rs 75 crore for the scheme.
Speaking on the sidelines of ARAI event on upcoming symposium on international automotive technologies, he said the ministry has "widely consulted the stakeholders, including the OEMs and the ACMA people".
Elaborating on points to be addressed in the next stage of FAME, Shankar said there was a heavy demand for the public transport and shared transport would be included which to a great extent had not been done earlier.
"The second thing is the charging infrastructure for electric vehicles as that is a problem area...We need charging infrastructure and policy for that, the cost itself is a big, big challenge," he added.
Stating that the high cost of pure electric vehicle is a prohibiting factor in its popularisation, Shankar said: "That is the biggest challenge and because of that perhaps not many vehicle producers are manufacturing electric vehicles."
Based on the outcome and experience gained in the first phase, the FAME scheme will be reviewed for implementation after March 31, 2017, with appropriate fund allocation in future.
Asked whether the Heavy Industries Ministry has sought continuance of the incentive for R&D/income tax rebate, Shankar said: "Yes, we have recommended that the R&D incentive must continue at 200 per cent. It is a question of balancing everything as a national policy because the Finance Minister has been saying that we would like reduce all the exemptions, so he has to take a final call".
The FAME India scheme entails provision of funds to the tune of Rs 260 crore and Rs 535 crore for the first two years, respectively, to be spent on technology platform (including testing infrastructure); demand incentives; charging infrastructure; pilot projects and operations.
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