The FAME scheme played a crucial role in driving the adoption of electric vehicles (EVs) in India. Reports suggested that the goverment might announce FAME-3 in the upcoming Union Budget 2024.
However, the new Minister of Heavy Industries, HD Kumaraswamy, said that plans are underway for the third phase of the Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicle (FAME) scheme, which is nearing completion. It appears unlikely that the government will unveil the scheme during the upcoming union budget.
Kumaraswamy, while talking to reporters on the sidelines of an industry event today, said:
“FAME 3 preparatory work is going on. All seven ministries have sent their recommendations on implementing the FAME program. It is going to be implemented in the coming days.”
The minister opted not to specify a precise date for introducing the new scheme. When asked about whether FAME 3 would be included in the upcoming union budget, the minister responded, “No, it is nearing completion.”
The third phase of the FAME scheme will succeed the temporary Electric Mobility Promotion Scheme (EMPS) 2024. This policy will come to a close by the end of July.
The EMPS scheme operated for a span of four months, from April 1 to July 31. With a total budget of Rs 500 crore, the aim was to maintain incentives for electric two and three-wheelers after the expiration of the FAME 2 scheme on March 31.
Background on FAME:
In 2015, the government launched the Faster Adoption and Manufacturing of Electric Vehicles (FAME) policy. The goal was to promote the adoption and production of EVs throughout India.
FAME-I inaugurated the initial phase, followed by FAME-II in 2019, which allocated a budget of ₹10,000 crore. The second phase concluded on March 31, 2024.
The primary objective of the scheme was to provide support for 10 lakh electric two-wheelers, 5 lakh electric three-wheelers, 55,000 passenger cars, and 7,000 electric buses.
Wrapping Up
Various emerging original equipment manufacturers (OEMs), especially those in the two-wheeler sector, industry associations, have been urging the government to maintain ongoing subsidies. The subsidy provided under the scheme has played a crucial role in encouraging the initial adoption of electric vehicles nationwide.
