The government is now contemplating prolonging the Faster Adaption of Manufacturing of Electric Vehicles (FAME) scheme, which is valid till March 2024, or somehow retaining its benefits, said a top government official on Friday.

The Ministry of Heavy Industries (MHI) is in consultation with the industry on this, said Hanif Qureshi, Joint Secretary, MHI, speaking at the first FICCI Awards for Excellence in Maintenance Systems and Conference on Efficient Maintenance Systems for Sustainable Industrial Growth, in New Delhi.

‘Supportive policies’

Qureshi underscored the rapid expansion of the automobile industry — which is currently valued at around $150 billion — and highlighted the anticipated growth of the electric vehicle (EV) segment within this sector, with a predicted compound annual growth rate (CAGR) of 26 per cent by 2030. “This impressive growth, is primarily driven by supportive policies,” he said.

Also read: Electric 2W sales may suffer on Centre’s lower FAME II subsidy ‘shock’ 

Qureshi also underscored the significance of maintenance systems in driving customer satisfaction and sustainable industrial growth.

Subsidy cut

In March this year, a Parliamentary panel on EVs had urged the government to frame a comprehensive national policy on EVs by incorporating the elements of successful State models and international best practices, and also for a two-year extension of the FAME-II scheme to allow more time to evaluate its effectiveness.

However, in May, through a gazette notification, the MHI decided to reduce the cap on incentives to 15 per cent from 40 per cent earlier (on ex-factory prices), which led to a rise in prices of electric two-wheelers. The amendments also included the reduction of demand incentive from ₹15,000 per per kilowatt per hour (kWh) to ₹10,000 per kWh.

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