Govt extends FAME-II scheme deadline by 4 months, allocates additional ₹500 crore to the scheme: Report

In a move to provide relief to electric vehicle manufacturers, the government has extended the FAME-II (Faster Adoption and Manufacturing of Electric Vehicles) scheme by four months, averting potential disruptions in the EV industry. The scheme, which was set to expire on March 31, will now continue until July 31, 2024, with an additional allocation of ₹500 crore to cover subsidies for demand incentives for electric two and three-wheelers, as per a CNBC-TV18 report.

According to the report, the approval for the FAME-III scheme might be delayed until after the general elections. This extension comes as a relief for EV firms, many of which were under pressure to clear their inventories before the previous deadline. Companies like Bengaluru-based Bounce Infinity and Ola Electric had recently slashed prices by significant margins in a bid to sell off their stock.

What is FAME-II Scheme?

The FAME-II scheme, launched in 2019 with a budget of ₹10,000 crore for three years, aimed to support the adoption of electric vehicles across various segments. This included targets such as subsidizing 7,000 e-buses, 5 lakh e-3 wheelers, 55,000 e-passenger cars, and 10 lakh e-two wheelers. As of December 21, 2023, a total of 12,16,380 vehicles have been subsidized under the scheme, amounting to an expenditure of ₹5,422 crore.

The extension of the FAME-II scheme is expected to provide a much-needed boost to the EV industry, allowing manufacturers to continue their operations with the assurance of government support. It also signifies the government's commitment to promoting clean and sustainable mobility solutions in the country.

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