To promote green fuel in India, the government is planning to give a huge subsidy to electric vehicles including electric cars and hybrid cars.
As per the govt close sources, about 60,000 electric cars in India may get a subsidy of up to Rs 2.5 lakh whereas hybrid cars will get Rs 20,000 that are brought over the next three years.
A major part of the subsidy funds will be allocated to electric two-wheelers, three-wheelers such as e-rickshaw and buses used for public transport.
Explaining the proposal, the sources said if a buyer of Mahindra E-Verito may get a subsidy of around Rs 1.5 lakh, while a buyer of a good quality electric two-wheeler could get around Rs 40k. The electric buses subsidy would be up to Rs 60 lakh.
The subsidy calculation- Rs 10,000 per KWh for all vehicles and Rs 20,000 per KWh for buses, will be linked to the battery capacity of the respective vehicles.
The proposal is expected to be in effect by April, said a TOI report.
The proposal is expected to be taken up by the Cabinet as part of the second phase of Faster Adoption and Manufacturing of (Hybrid & Electric Vehicles) India (FAME) scheme, which was scheduled to start in February.
Besides, the govt plans to allocate Rs 350 crore to have a concerted investment in research and innovation addressing the development of battery and its components.
Till date, the government has claimed to have provided incentives to 2.6 lakh EV, which has saved around 37 million litres of fossil fuel. The govt has provided Rs 305 crore worth subsidy. The subsidy is a part of an Rs 9,400-crore package for electric and hybrid engines.
In January, the govt had cut down customs duty on electric vehicle parts to 10-15 per cent from 15-30 per cent.
The government has been trying to maximise the use of EV in the country to achieve complete electrification by 2030. Car makers like Maruti Suzuki, Mahindra and even Tata Motors have already begun their campaign as far as electric cars are concerned. In early 2018, Toyota and Suzuki had signed an MoU to make EVs in the Indian market by around 2020.
Meanwhile, the sales of EV has not been as much encouraging as expected. In 2017-18 EV sales stood at around 56,000 units as against about 25,000 units in the previous year.