 "Electric vehicles")
Union Finance Minister Nirmala Sitharaman unveiled the central government’s commitment to strengthen the electric vehicle ecosystem in the country. Presenting the Interim Budget in Lok Sabha, Sitharaman announced that the government will continue its support for manufacturing and charging infrastructure.
"Our Government will expand and strengthen the e-vehicle ecosystem by supporting manufacturing and charging infrastructure," Sitharaman said during her Budget speech.
The greater focus will be on the adoption of electric buses (e-buses) for public transport networks. The ambitious payment security mechanism also found a mention in the budget. "Greater adoption of e-buses for public transport networks will be encouraged through payment security mechanisms (PMS)," the finance minister said.
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On August 8, Business Standard was the first to report the government’s intention to introduce a payment security fund of approximately Rs 4,126 crore. This fund aims to facilitate the procurement of 38,000 electric buses (e-buses) nationwide. Significantly, the United States government is collaborating with India on this initiative by contributing $150 million (Rs 1,241 crore) towards the fund, with the government committing the remaining funds.
The government also granted an extension to the Faster Adoption and Manufacturing of Hybrid & Electric Vehicles in India (FAME-India) scheme. Rs 2,671 crore was also allocated for the scheme. The second phase of FAME is scheduled to end on March 31.
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The government's efforts to establish an electric ecosystem align with its ongoing initiatives. In addition to PSM and FAME, the government has existing production-linked incentive (PLI) schemes for automotive and auto components, with a budget allocation of approximately Rs 25,938 crore. Furthermore, there is a Rs 18,100 crore PLI scheme specifically for advanced chemistry cells.
To boost the adoption of e-buses nationwide, the government had also unveiled the ambitious PM-eBus Sewa scheme on August 16, aiming to deploy 10,000 electric buses across 169 cities.
The third phase of the FAME scheme is expected to give a boost to electric buses. From Rs 3,209 crore in FAME-II, the allocation for e-buses is likely to rise to Rs 4,500 crore under FAME-III.
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On January 23, Business Standard was the first to report that, in addition to buses, the FAME-III initiative will prioritise charging infrastructure. The scheme intends to allocate Rs 2,000 crore for the development of electric vehicle-ready highways.
EV sales this 2023 have witnessed a robust increase of over 45 per cent so far, notwithstanding the subsidy cuts and regulatory shifts. Total EV registration figure in 2023 touched the 1.5 million units mark, significantly higher than last year’s score of a little over 1 million.
