As the NDA government enters its third term, one of its first major initiatives will be launching the third edition of the FAME (Faster Adoption and Manufacturing of Electric Vehicles) scheme, with a substantial outlay of Rs 10,000 crores. The FAME scheme aims to enhance local manufacturing and sales of electric vehicles by offering demand incentives to customers.
Let’s explore the key aspects of the FAME 3 scheme and understand how it will accelerate the adoption of electric vehicles in India’s automotive sector.
What’s Happening?
In its ongoing efforts to decarbonise the transport sector and promote electric vehicles, the government is all set to launch the third phase of the flagship EV incentive scheme, FAME, with a budget exceeding Rs 10,000 crores.
In this year’s interim budget, the finance minister allocated Rs 2,671.33 crores for the FAME III scheme. The new government is expected to make detailed announcements in the main budget, scheduled for July 2024.
Brief History of the FAME Scheme
The FAME India scheme was first launched on April 1, 2015, with a total outlay of Rs 895 crores.
The FAME II scheme, introduced in 2019 with a budget of Rs 10,000 crores for three years, aimed to support the adoption of 7,000 e-buses, five lakh e-3 wheelers, 55,000 e-passenger cars, and 10 lakh e-two wheelers. An additional Rs 1,500 crores was later allocated.
As of March 30, 15,42,452 electric vehicles have been subsidised under the scheme, including 13,64,929 two-wheelers, 15,717 three-wheelers, and 20,352 four-wheelers.
All About the FAME 3 Scheme
According to CNBC TV 18, the FAME 3 scheme will have a budget of approximately Rs 10,000 crores, offering financial incentives for electric two-wheelers, three-wheelers, and government-owned buses.
Unlike the five-year duration of FAME 2, FAME 3 will initially be valid for two years. The government, which supported the purchase of 7,000 electric buses under FAME 2, is expected to increase this number under FAME 3.
FAME 3 is likely to exclude subsidies for electric cars, including those for commercial use.
The government will introduce new guidelines, and companies seeking benefits will need to undergo re-certification.
What’s Next?
The upcoming FAME 3 scheme marks a significant step forward in India’s journey towards sustainable transportation. By building on the successes of FAME 1 and 2 and addressing current challenges in the EV ecosystem, the government is poised to foster a more robust and widespread adoption of electric vehicles.
That’s it for today. We hope you’ve found this article informative. Remember to spread the word among your friends. Until we meet again, stay curious!
*The article is for information purposes only. This is not an investment advice.
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