Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in - 28th July 2026 - Ministry of Heavy Industries - Gazette Notification PDF
Issued by Ministry of Heavy Industries
Read or download the official PDF of this gazette notification issued by the Ministry of Heavy Industries on 28th July 2026. Classified under Press Release.
Executive Summary & Key Takeaways
Executive Summary This report outlines the Ministry of Heavy Industries' initiatives to develop a coordinated electric vehicle (EV) ecosystem in India through various financial and regulatory schemes. Key highlights include the transition from FAME-II to the PM E-DRIVE scheme (notified September 2024) and the implementation of Production Linked Incentive (PLI) schemes for manufacturing. Significant outlays are designated for vehicle incentivization, charging infrastructure, and e-bus deployment through 2024 and beyond.
Key Points / Main Content
Financial Incentives and Phase-II Outcomes
- FAME India Phase-II: Concluded on March 31, 2024, with a budget of ₹11,500 crore, supporting 16.72 lakh EVs and 5,197 e-buses.
- PM E-DRIVE Scheme: Launched September 29, 2024, with a ₹10,900 crore outlay to support 28.30 lakh EVs, including e-2Ws, e-3Ws, e-Trucks, and e-Ambulances.
- Charging Infrastructure: Dedicated allocations of ₹912.50 crore under FAME-II and ₹2,000 crore under PM E-DRIVE for pan-India public charging stations.
Manufacturing and Industrial Growth
- PLI-Auto: A ₹25,938 crore scheme notified in 2021 to enhance manufacturing of Advanced Automotive Technology (AAT) products.
- PLI-ACC: An ₹18,100 crore scheme aimed at establishing a 50 GWh domestic manufacturing capacity for Advanced Chemistry Cell battery storage.
- SPMEPCI Scheme: Notified March 15, 2024, targeting electric passenger car manufacturing with a minimum investment requirement of ₹4,150 crore.
- Localization Requirements: SPMEPCI requires a Domestic Value Addition (DVA) of 25% by the third year and 50% by the fifth year.
Public Transportation and Infrastructure
- E-Bus Deployment: PM E-DRIVE allocates ₹4,391 crore for 14,028 e-buses, primarily targeting seven major cities and Jammu & Kashmir.
- PM e-Bus Sewa (PSM): A ₹3,435.33 crore scheme providing payment security to operators to support the deployment of over 38,000 electric buses.
- Agency Upgradation: Grants are available under PM E-DRIVE for the modernization of vehicle testing agencies.
Regulatory and Fiscal Support
- Tax Reductions: GST on electric vehicles and chargers has been reduced to 5%.
- Exemptions: Battery-operated vehicles are exempt from permit requirements and feature green license plates.
- State Incentives: Federal advisories encourage states to waive road taxes to lower the initial acquisition cost for consumers.
Impact Analysis
Vehicle Manufacturers (OEMs) Impact: Beneficiaries of substantial PLI outlays and demand incentives for various vehicle categories. Action Required: Must invest in AAT/ACC technologies and meet specific DVA targets (25%–50%) and minimum investment thresholds (e.g., ₹4,150 crore for passenger cars).
Public Transport Authorities (PTAs) and E-bus Operators Impact: Access to payment security mechanisms and budgetary support for large-scale e-bus deployment. Action Required: Coordinate the deployment of allocated e-buses in designated cities and utilize the Payment Security Mechanism (PSM) to mitigate default risks.
EV Infrastructure Providers Impact: Direct financial support via a ₹2,000 crore allocation for establishing public charging stations. Action Required: Implement charging infrastructure on a pan-India basis to meet the growing demand supported by the PM E-DRIVE scheme.
Testing Agencies Impact: Eligible for grants to modernize facilities. Action Required: Upgrade testing infrastructure to accommodate new electric vehicle and battery standards.
Consumers Impact: Reduced purchase costs through GST cuts, road tax waivers, and direct demand incentives. Action Required: Benefit from lower operational hurdles such as permit exemptions and incentivized pricing.