Subsidy on EV purchases to continue, EMPS to be extended till FAME 3 launch: HD Kumaraswamy

Amid concerns about the continuation of incentives for the purchase of electric vehicles, Minister of Heavy Industries HD Kumaraswamy announced today that the government will continue to provide subsidies, and that the temporary Electric Mobility Promotion Scheme (EMPS) 2024 will be extended beyond the end of the month.

Union Minister for Heavy Industries Kumaraswamy commented on the issue, saying, "There will be a gap between the current EMPS scheme and the implementation of the FAME 3 program because the ministry is looking at the challenges faced by the FAME2 scheme, which the government is attempting to mitigate with FAME 3."

"In a short period, you will receive all of the information," Kumaraswamy said on the sidelines of the Automotive Component Manufacturers Association of India’s annual session in Delhi.

He had earlier said that the FAME 3 would be rolled out in the next 1-2 months.

His comments come as the EMPS approaches its expiration date at the end of September. The government is currently working on the third phase of the FAME scheme, which will replace the EMPS.

The EMPS scheme, initially valid for four months and then extended for two more months, was launched with a total outlay of Rs 500 crore after the FAME 2 scheme expired on March 31, to ensure the continuation of incentives for electric two- and three-wheelers.

The FAME 2 scheme was rolled out in 2019 with an initial outlay of Rs 10,000 crore for three years ending in 2022. It was later extended to March 2024 with an additional outlay of Rs 1,500 crore. 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.