Government Extends FAME II Scheme's Validity For Three Months

The Ministry of Heavy Industries and Public Enterprises, Government of India, has further extended the validation of the Faster Adoption and Manufacturing of Electric Vehicles II (FAME II) scheme for a period of three months. In July, the validity was extended to September 2020 which is coming to an end now. All registered automakers under the FAME II scheme will now be able to avail the benefits till December 31, 2020. The extension applies to all approved electric two-wheelers, three-wheelers and four-wheelers with-effect-from October 1, 2020. However, there is yet no clarity about bigger EVs like electric buses.

Also Read: FAME II Scheme's Validity Extended Till September 2020

The government is trying to reduce the tax rates on electric vehicles.

Last year in February, the government had allocated Rs. 10,000 crore for the FAME II scheme in succession to the FAME I scheme. The allocated amount was channelised to speed up the development of EVs and EV infrastructure in a bid to achieve the target of 100 per cent electrification of vehicles by 2030. The FAME II scheme primarily aims to incentivise the purchase of electric vehicles and establishing the requisite charging infrastructure for electric vehicles. Moreover, the government has been trying to bring down the tax rates on electric vehicles (EVs) which is charged at 5 per cent at present compared to 28 per cent for other vehicles. It is also trying to reduce the tax rates on Hybrid vehicles.

Also Read: Government Working To Reduce GST Rates On Electric Vehicles: Niti Aayog

Mercedes-Benz is gearing up to launchits first all-electric car - the EQC in India.

The incentives are mainly given to the commercial three-wheeler and four-wheeler vehicles along with private two-wheelers. Through this initiative, the government was targeting to facilitate the purchase of 10 lakh electric two-wheelers, 5 lakh electric three-wheelers, 55,000 electric four wheelers and 7000 electric buses. However, incentives are given specifically to those vehicles which are powered by a lithium-ion battery or run on other advance technologies like fuel cell, as an effort to encourage new age technologies. Automakers like Hyundai India, MG Motor India among others have already launched their electric vehicles in India and Mercedes-Benz is set to be the first luxury carmaker to bring their EV- the EQC in India. The move will further improve the sentiments of automakers to continue working towards the government's ambitious goal of 100 per cent electrification by the end of this decade.