Executive Summary:
The Indian government, through the Ministry of Heavy Industries, has launched multiple schemes and initiatives to bolster the Electric Vehicle (EV) sector. These initiatives include financial incentives, infrastructure development, and promotion of research and development in EV technologies. Key schemes include FAME India Scheme Phase II (ending March 31, 2024) and PM EDRIVE Scheme (starting April 1, 2024).
Key Points / Main Content:
Government Schemes for EV Infrastructure Improvement:
* Faster Adoption and Manufacturing of Hybrid Electric Vehicles in India (FAME India) Scheme Phase II: Implemented from April 1, 2019, to March 31, 2024, with Rs. 11,500 crore budgetary support, providing demand incentives for various EVs and grants for EV public charging stations.
* PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM EDRIVE) Scheme: Being implemented from April 1, 2024, to March 31, 2026, with Rs. 10,900 crore outlay, supporting electric vehicles including e2W, e3W, eTrucks, ebuses, eAmbulances, EV PCS and upgradation of testing agencies.
* PLI Scheme for Advanced Chemistry Cell (ACC): Approved on May 12, 2021, with Rs. 18,100 crore outlay, aiming to establish a domestic manufacturing ecosystem for 50 GWh of ACC batteries.
* Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry in India (PLI-Auto): Approved on September 23, 2021, with Rs. 25,938 crore outlay, providing financial incentives to boost domestic manufacturing of Advanced Automotive Technology (AAT) products.
* Scheme for Promotion of Manufacturing of Electric Passenger Cars in India (SPMEPCI): Notified on March 15, 2024, requiring minimum investment of Rs. 4150 crore and achieving a minimum Domestic Value Addition (DVA) of 25% by the end of the third year and 50% by the end of the fifth year.
* PM eBus Sewa-Payment Security Mechanism (PSM) Scheme: Notified on October 28, 2024, with an outlay of Rs. 3,435.33 crore, supporting the deployment of over 38,000 electric buses.
Other Ministries' Initiatives:
* Ministry of Power: Issued guidelines and standards for EV Charging Infrastructure on September 17, 2024.
* Ministry of Finance: Reduced GST on EVs from 12% to 5%.
* Ministry of Road Transport & Highways (MoRTH): Announced green plates for battery-operated vehicles, exemption from permit requirements, and advised states to waive road tax on EVs.
* Ministry of Housing and Urban Affairs: Amended Model Building Bye Laws to mandate charging stations in buildings.
Promotion of New Technologies and R&D in EVs:
* Expenditure on Engineering R&D and product design development is considered part of Eligible Investment under PLI-Auto, PLI ACC, and SPMEPCI schemes.
* Up to 80% of the cost of R&D projects on EVs is supported under the Capital Goods scheme of MHI.
* Centres of excellence have been set up for development of niche technologies not available in India.
* Rs. 780 crore is allocated under PM EDRIVE for upgrading EV testing agencies.
* International Advanced Research Centre for Powder Metallurgy and New Materials (ARCI) has developed advanced battery technologies, including materials for Lithium and Sodium ion batteries.
Impact Analysis:
Automobile and Auto Component Manufacturers:
* Impact: Opportunity to receive financial incentives for domestic manufacturing of AAT products and investments in the automotive manufacturing value chain through PLI schemes. Must adhere to DVA requirements under SPMEPCI.
* Action Required: Apply for relevant PLI schemes, invest in AAT, and meet DVA criteria to qualify for incentives.
EV Charging Station Operators:
* Impact: Benefit from financial support for setting up public charging stations under FAME India and PM EDRIVE schemes. Must adhere to guidelines and standards issued by the Ministry of Power.
* Action Required: Apply for grants, ensure compliance with charging infrastructure guidelines, and establish interoperable charging networks.
Electric Bus Operators:
* Impact: Benefit from the PM eBus Sewa scheme which provides payment security in case of default by Public Transport Authorities (PTAs).
* Action Required: Participate in the PM eBus Sewa scheme to deploy more electric buses.
Public Transport Authorities:
* Impact: Responsible for ensuring payments to eBus operators, with the PM eBus Sewa scheme providing a security mechanism.
* Action Required: Fulfill payment obligations to eBus operators to avoid triggering the payment security mechanism.
R&D Institutions (IITs, IISc, ARCI):
* Impact: Opportunity to receive funding for R&D projects related to EVs and develop advanced battery technologies.
* Action Required: Collaborate with industry partners and the government to conduct R&D and develop innovative EV technologies.
Consumers:
* Impact: Reduced GST on EVs and potential waiver of road tax, leading to lower initial costs.
* Action Required: Consider purchasing EVs to take advantage of incentives and contribute to environmental sustainability.
Key Entities Referenced
Faster Adoption and Manufacturing of Hybrid Electric Vehicles in India FAME India Scheme PhaseII: A government scheme implemented from 1st April, 2019 to 31st March 2024 with a total budgetary support of Rs.11,500 crore to improve Electric Vehicle EV infrastructure in the country.
PM Electric Drive Revolution in Innovative Vehicle Enhancement PM EDRIVE Scheme: A scheme with an outlay of Rs. 10,900 crore implemented from 1st April 2024 to 31st March 2026 to support electric vehicles.
PLI Scheme for Advanced Chemistry Cell ACC: A Production Linked Incentive scheme approved on 12th May, 2021 with a budgetary outlay of Rs. 18,100 crore for manufacturing of ACC in the country.
Production Linked Incentive PLI Scheme for Automobile and Auto Component Industry in India PLIAuto: A Production Linked Incentive scheme approved on 23rd September, 2021 with a budgetary outlay of 25,938 crore to boost domestic manufacturing of Advanced Automotive Technology products.
Scheme for Promotion of Manufacturing of Electric Passenger Cars in India SPMEPCI: A scheme notified on 15th March, 2024 to promote the manufacturing of electric cars in India.
PM eBus SewaPayment Security Mechanism PSM Scheme: A Scheme notified on 28.10.2024, with an outlay of Rs. 3,435.33 crore to support deployment of more than 38,000 electric buses.
Ministry of Power: A ministry that has issued guidelines and standards for EV Charging Infrastructure titled, "Guidelines for Installation and Operation of Electric Vehicle Charging Infrastructure2024".
International Advanced Research Centre for Powder Metallurgy and New Materials ARCI, Hyderabad, Telangana: An autonomous RD centre under Department of Science and Technology DST, that has developed several advanced battery technologies.
GOVERNMENT OF INDIA
MINISTRY OF HEAVY INDUSTRIES
LOK SABHA
UNSTARRED QUESTION NO. 2637
ANSWERED ON 05.08.2025
INITIATIVES TO IMPROVE EV SECTOR
2637. DR. NISHIKANT DUBEY:
Will the Minister of HEAVY INDUSTRIES be pleased to state:
(a) the details of initiatives taken to improve Electric Vehicle (EV) infrastructure in the country;
(b) whether the Government is adopting new technologies and spending on Research and
Development (R&D) related to EV; and
(c) if so, the details thereof?
ANSWER
THE MINISTER OF STATE FOR HEAVY INDUSTRIES
(SHRI BHUPATHIRAJU SRINIVASA VARMA)
(a) The Government has launched following schemes to improve Electric Vehicle (EV)
infrastructure in the country: -
1. Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India
(FAME India) Scheme Phase-II: The Government implemented this scheme for a period of
five years from 1st April, 2019 to 31st March 2024 with a total budgetary support of Rs.11,500
crore. The scheme provided demand incentive for e-2Ws, e-3Ws, e-4Ws and grant for e-buses
and setting up of EV public charging stations (EV PCS).
2. PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE)
Scheme: This scheme with an outlay of Rs. 10,900 crore is being implemented from 1st April
2024 to 31st March 2026. PM E-DRIVE aims to support electric vehicles including e-2W, e-
3W, e-Trucks, e-buses, e-Ambulances, EV PCS and upgradation of testing agencies.
3. PLI Scheme for Advanced Chemistry Cell (ACC): The Government on 12th May,
2021 approved PLI Scheme for manufacturing of ACC in the country with a budgetary outlay
of Rs. 18,100 crore. The scheme aims to establish a competitive domestic manufacturing
ecosystem for 50 GWh of ACC batteries.
4. Production Linked Incentive (PLI) Scheme for Automobile and Auto Component
Industry in India (PLI-Auto): The Government approved this scheme on 23rd September, 2021
with a budgetary outlay of ₹25,938 crore. The scheme provides financial incentives to boost
domestic manufacturing of Advanced Automotive Technology (AAT) products with minimum
50% Domestic Value Addition (DVA) and attract investments in the automotive manufacturing
value chain.
5. Scheme for Promotion of Manufacturing of Electric Passenger Cars in India
(SPMEPCI): The scheme was notified on 15th March, 2024 to promote the manufacturing of
electric cars in India. This requires applicants to invest a minimum of Rs. 4150 crore and to
achieve a minimum DVA of 25% at the end of the third year and DVA of 50% at the end of the
fifth year.-2-
6. PM e-Bus Sewa-Payment Security Mechanism (PSM) Scheme: This Scheme notified
on 28.10.2024, has an outlay of Rs. 3,435.33 crore and aims to support deployment of more than
38,000 electric buses. The objective of scheme is to provide payment security to e-bus operators
in case of default by Public Transport Authorities (PTAs).
Besides above following initiatives have been taken by other Ministries :
i. Ministry of Power has issued guidelines and standards for EV Charging Infrastructure
titled, "Guidelines for Installation and Operation of Electric Vehicle Charging
Infrastructure-2024" on 17th September, 2024. These revised guidelines outline standards
and protocols to create a connected and interoperable EV charging infrastructure network
in the country. These guidelines also facilitate electricity connections for EV charging
stations.
ii. Ministry of Finance has reduced GST on EVs from 12% to 5%.
iii. Ministry of Road Transport & Highways (MoRTH) announced that the battery
operated vehicles will be given green plates and be exempted from permit requirements.
MoRTH issued a notification advising states to waive road tax on EVs, which in turn will
help reduce the initial cost of the EVs.
iv. Ministry of Housing and Urban Affairs has amended the Model Building Bye-
Laws, mandating the inclusion of charging stations in private and commercial buildings.
(b) & (c): Yes, the Government is promoting new technologies and spending on Research
and Development (R&D) related to EVs through the following :
1. The expenditure incurred on Engineering R&D and product design & development is
allowed to be considered as part of Eligible Investment under PLI-Auto, PLI ACC and
SPMEPCI schemes.
2. Under the Capital Goods scheme of MHI, up to 80% of the cost of R&D projects
including those on EVs is supported. These projects are housed in leading academic institutes
like IITs, IISc., etc. The balance 20% is borne by the industry partners.
3. Centres of excellence have been set up for development of niche technologies not
available in India, including technologies related to EVs.
4. An amount of Rs.780 crore is allocated under PM E-DRIVE for upgradation of testing
agencies especially for EV related testing. This will also facilitate EV related R&D efforts of the
automotive industry.
5. Further, the International Advanced Research Centre for Powder Metallurgy and New
Materials (ARCI), Hyderabad, an autonomous R&D centre under Department of Science and
Technology (DST), has developed several advanced battery technologies. These are as under : -
I. Development of materials for Lithium and Sodium ion and Lithium Sulphur (LiS)
batteries; Fabrication and validation of cylindrical and pouch cells.
i. Cobalt free High Voltage Cathode Materials (LiMnFePO & LiNi0.5Mn1.5O4 for High
4
Energy Li-ion Battery Application
ii. High Performance NVP, layered oxides as cathodes and Hard Carbon from Bio-
waste as anode for Na-ion Battery Applications
iii. Metal oxide modified Carbon Sulphur composite cathodes for high performance and
stable Li-S batteries.-3-
II. Development of cost-effective and high-performance composite PCMS for battery
thermal management systems in EV Applications.
III. Development of Aluminium-ion Battery as alternative to LIBs in EV and ESS
applications
IV. Development of Hybrid-models for accelerated service life predication of LIBs and other
battery systems.
V. Development of Eco-friendly process (wet & dry) for battery electrode fabrications
VI. Developing a scalable method for tuning the internal pore structure and porosity of a metal
or alloy for thermal energy absorption, storage, and conversion applications.
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