Cabinet Gives Green Signal To Rs 10,000 Crore FAME II Scheme

The eagerly-awaited second edition of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme, which was supposed to be implemented last year, finally saw the light of the day as that the Union Cabinet on 28th February has cleared the programme with a total allocation of Rs. 10,000 crore. Finance Minister Arun Jaitley announced that the scheme will be implemented over a period of three years with effect from April 1, 2019. The new scheme, which is in succession to the Rs. 895 crore-FAME I scheme, will help in addressing the burning issues of the country’s environmental pollution and fuel security.
 
“The emphasis will be on electrification of public transport that includes shared transport, demand incentives on operational expenditure mode for electric buses will be delivered through state/city transport corporations (STUs),” the government of India stated in an official release, adding, “In three-wheeler and four-wheeler segments, incentives will be applicable mainly on vehicles used for public transport or registered commercial purposes. In the two-wheeler segment, the focus will be on private vehicles. Through the scheme, it is planned to support 10 lakh electric two-wheelers, five lakh three-wheelers, 55,000 four-wheelers and 7,000 buses." 

“The primary objective of the scheme is to encourage faster adoption of electric and hybrid vehicles by way of offering upfront incentives on purchase of electric vehicles and also by way of establishing necessary charging infrastructure for EVs,” Jaitley was quoted as saying to reporters, adding, “The benefits of the incentives will be extended to only those vehicles which are equipped with advanced technologies like lithium-ion batteries.”

“This scheme also supports for setting up of charging infrastructure whereby about 2,700 charging stations will be set up in metros, other million-plus cities, smart cities and cities of hilly states across India,” the statement further added. “The plan is to ensure availability of at least one charging station in a grid of 3km x 3km. The establishment of charging stations are also proposed on major highways connecting major city clusters. On such highways, charging stations will be established on both sides of the road at an interval of about 25 km each,” it added.

Meanwhile, the auto industry has welcomed the announcement of the FAME II. Rajan Wadhera, President, SIAM maintained, “This (scheme) will provide a big fillip to our joint efforts to introduce higher levels of Electric Mobility in the country. The three-year Scheme with significantly enhanced financial allocations as reported, will instill tremendous confidence in the auto as well as in the component industry while taking long-term investment decisions in EV development and manufacture, with minimum risk.”

“As per our understanding, the FAME II will focus on EVs used for commercial applications and two/three wheelers and in creating the necessary infrastructure and ecosystem for EVs, which is a welcome move. While the details of the Scheme will be known shortly, the announcement of the Scheme, in itself, is a major milestone and augurs very positively for ushering clean and sustainable mobility in the country which the industry and SIAM will fully support, Wadhera further added.
 
 “We are thankful to the government for considering our demand for a long-term scheme with substantial fund support. The support would encourage associated industry players to invest in the sector, which will further help in creating an ecosystem, locally. We look forward to seeing the final notification from the concerned ministry, which will give us clarity on the government’s roadmap of e-mobility,” Sohinder Gill, Director General, Society of Manufacturers  of Electric Vehicles (SMEV
 
 Dr. Pawan Goenka, MD, M&M Ltd. stated, “The new outlay of Rs 10,000 crore over a period of three years provides a stable policy to promote green mobility in India. It addresses the key issues including National Energy Security, mitigation of the adverse impact of vehicles on the environment and the growth of domestic technology and manufacturing capabilities. The revised FAME II removes all the uncertainty and will put electric vehicles in the fast lane. Mahindra supports the central government’s focus to boost EVs in public transportation and now requests local authorities to help facilitate plying of electric vehicles on Indian roads.”

 “Government support with the FAME II scheme is holistic and includes focus on charging Infrastructure with a clear emphasis on "Make in India".  We feel that it is now the responsibility of suppliers, OEMs and mobility service providers to invest in EVs and make India's EV dream become a reality,” Dr. Goenka further added.