Indian Government subsidizes sales of electric vehicles – Dr Abhinandan Ballary

Attention India
3 Min Read

India intensifies the electrification of its vehicle fleets to cut down on pollution and crude oil purchases.

The goal

The government aims to save about 12 billion euros yearly on crude oil, reduce air pollution, and increase EV adoption.

The challenges

The initial cost of buying an EV is high, and the batteries are costly because it consists of lithium. However, the Indian Government offers an incentive to encourage the switch to EVs.

The incentives

According to Budget 2022-23, FAME (Faster Adoption and Manufacturing of Hybrid and Electric vehicles) provides incentives of about INR2908 Cr.

FAME’s first phase began in 2015 and lasted through 2019. Its second phase extends to March 2024. 

The second phase of FAME has supported more than 200,000 vehicles. You can get an incentive of INR 15,000 per KWH when you buy an electric bike.

If you take a loan from a registered bank to buy an electric bike or car, you could get a tax exemption of about INR 1.5 Lakh.

The Government also offers a waiver on road tax and registration fees for electric vehicles with zero parking till 2025.

The Government added a subsidy of INR 10,000 per KWH for the first 10,000 electric vehicle purchases to further speed up EV purchases.

The result

Several states embraced the policies to promote the adoption of EVs to producers and consumers.

States like Gujarat, Maharashtra, Karnataka, Telangana, Tamil Nadu, Andhra Pradesh, Delhi, Himachal Pradesh, Kerala, Bihar, Uttar Pradesh, Rajasthan, and Meghalaya.

These EV policies birthed more nationwide charging stations, easing Indians’ transition to EVs.

Andhra Pradesh, Karnataka, and Telangana focus on promoting product manufacturing and component.

While Maharashtra, Delhi, and Gujarat concentrate more on offering upfront rebates and discounts to consumers.

About Maharashtra EV policy

Maharashtra pledged to offer incentives to automotive companies that can deliver a five-year battery warranty to their consumers.

It plans to install more than 2400 EV charging stations across seven cities.

About Gujarat EV policy

Gujarat plans to install 250 new EV charging infrastructure and double the subsidy amount of any other state for EVs per kilowatt.  

About Delhi EV policy

Delhi plans to electrify its bus fleets by at least 50%, starting with 1000 electric buses by 2020 and 25% of new EV registration by 2024.


EV policies in India vary from state to state, but if you buy an electric vehicle, you can claim tax benefits and reduce pollution; ensure that you check your state’s EV policy. 

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