PROMOTION OF ELECTRIC VEHICLES IN VIEW OF RISING POLLUTION LEVELS IN MAJOR CITIES

**Executive Summary** This document, posted by PIB Delhi on February 13, 2026, outlines measures taken by the Government to promote Electric Vehicles (EVs) in major cities, focusing on schemes implemented by the Ministry of Heavy Industries. These schemes support EV adoption, domestic manufacturing, and cost reduction through incentives and subsidies. The schemes mentioned have deadlines ranging from March 31, 2024, to October 28, 2024. **Key Points / Main Content** * **Government Initiatives for EV Promotion:** * The Ministry of Heavy Industries (MHI) has implemented various schemes to promote Electric Vehicles (EVs). * **FAME India Scheme Phase-II:** * Implemented from April 1, 2019, to March 31, 2024, with a budgetary support of Rs.11,500 crore. * Provides demand incentives for electric 2-wheelers (e-2Ws), 3-wheelers (e-3Ws), 4-wheelers (e-4Ws), grants for e-buses, and supports EV public charging stations (EV PCS). * Supported the sale of approximately 16.71 lakh electric vehicles and sanctioned 6,862 e-buses. * **PLI Scheme for Automobile and Auto Component Industry (PLI-Auto):** * Notified on September 23, 2021, with a budgetary outlay of Rs.25,938 crore. * Aims to enhance India's manufacturing capabilities for Advanced Automotive Technology (AAT) products, including EVs. * **PLI Scheme for National Programme on Advanced Chemistry Cell (ACC) Battery Storage:** * Notified on June 9, 2021, with a budgetary outlay of Rs.18,100 crore. * Aims to establish a competitive domestic manufacturing ecosystem for 50 GWh of ACC batteries. * **PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM EDRIVE) Scheme:** * Notified on September 29, 2024, with an outlay of Rs.10,900 crore. * Supports incentivization of approximately 28.27 lakh EVs and includes EV public charging stations and upgrading testing agencies. * Allocates Rs.4,391 crore for deploying 14,028 e-buses in seven cities with a population over four million. * **PM e-Bus Sewa-Payment Security Mechanism (PSM) Scheme:** * Notified on October 28, 2024, with an outlay of Rs.3,435.33 crore. * Aims to support the deployment of more than 38,000 electric buses, providing payment security to e-bus operators. * **Scheme for Promotion of Manufacturing of Electric Passenger Cars in India (SPMEPCI):** * Notified on March 15, 2024, to promote electric car manufacturing in India. * Requires a minimum investment of Rs.4,150 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. * **Measures to Reduce EV Costs:** * Direct subsidies: Upfront demand incentives under PM E-DRIVE. * Tax benefits: Reduced GST on EVs (12% to 5%) and chargers (18% to 5%); States advised to waive road tax and registration fees. * Domestic manufacturing: PLI-ACC and PLI-Auto schemes aim to lower costs by promoting economies of scale. * **EV Charging Infrastructure:** * 29,151 EV public charging stations (EVPCS) have been installed in the country. * Rs.2,000 crore allocated under the PM E-DRIVE Scheme for deploying adequate EVPCS. * **EV Battery Support:** * Government supports long-range EV battery development through PLI-ACC. * Battery Management System (BMS) included under PLI-Auto. * Traction battery pack is a mandatory component under FAME-II and PM E-DRIVE. **Impact Analysis** **EV Manufacturers:** * **Impact:** Benefit from incentives to increase production and domestic value addition; lowered manufacturing costs through economies of scale; increased demand due to reduced prices for consumers * **Action Required:** Implement phased manufacturing programs (PMP) under FAME-II and PM E-DRIVE schemes; Invest a minimum of Rs 4,150 crore and achieve minimum DVA of 25% and 50% in the third and fifth years respectively to be eligible for Scheme for Promotion of Manufacturing of Electric Passenger Cars. **Auto Component Manufacturers:** * **Impact:** Benefit from Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry * **Action Required:** Participate in PLI schemes to benefit from incentives for domestic manufacturing of advanced chemistry battery cells and EV components. **Public Transport Authorities (PTAs):** * **Impact:** Provided with payment security in case of default by e-bus operators. * **Action Required:** Utilize e-bus services supported by the PM e-Bus Sewa-Payment Security Mechanism (PSM) Scheme to deploy more electric buses. **Consumers:** * **Impact:** Reduction in the purchase price of EVs due to upfront demand incentives. Reduction in the overall cost of electric vehicles because of lower GST and road tax/registration fees. * **Action Required:** Take advantage of direct subsidies under PM E-DRIVE, reduced GST and road tax, and registration fees to purchase EVs at a lower cost.

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