E-2-wheelers may get subsidy for 3 more months

NEW DELHI: Govt is likely to extend subsidies for electric two-wheelers under the PM e-Drive scheme until June, while subsidies for e-rickshaws may continue for two years or so. The scheme, initially notified in Sept 2024, is valid till March 31.

"We are looking at extending the incentive for these two categories of electric vehicles. Since we have budget under this head, we want that more people get the benefit of the scheme," a person aware of the development said. Under the scheme, e-two-wheeler and e-rickshaw buyers get subsidy of Rs 2,500 per kWh.

Official data shows that out of Rs 1,772 crore subsidy earmarked for electric two-wheelers, about Rs 1,260 crore has been utilised. For electric three-wheelers, Rs 737 crore has been spent out of the Rs 907 crore allocation.

Industry sources said e-rickshaw manufacturers have struggled to meet localisation norms under the Phased Manufacturing Programme (PMP), making it difficult for many players to qualify for subsidies.

"In the e-rickshaw segment, localisation remains a challenge as several key components such as traction battery packs, motors and instrument clusters are still largely imported. This has limited eligibility for incentives and slowed fund utilisation," an industry executive said. The Rs 10,900-crore PM E-Drive scheme aims to accelerate EV adoption and build charging infrastructure across the country. Incentives are offered as upfront price reductions for buyers, which are later reimbursed to manufacturers, while localisation norms are aimed at strengthening domestic EV manufacturing.

The scheme has been extended by two years, from March 2026, to March 2028, to support the adoption of electric buses, trucks, and ambulances. The scheme aims to boost local manufacturing, requiring e-bus makers to localise traction motors, but so far, no electric buses or trucks have hit the road, according to department of heavy industry data.

Officials said that trucks are in the process of getting tested before sales start.



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