The Centre may extend its electric mobility programme – the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme by two years till March 31, 2024, sources told Mint.
One source told the paper a decision on the two-year extension “is expected shortly”, while the second source noted that the Centre’s think tank NITI Aayog has also suggested “reworking” the scheme to pare costs of electric vehicles (EVs).
“NITI Aayog has suggested the reworking FAME II to help bring down the cost of EVs on par with those with internal combustion engines (ICE), leverage the benefit of aggregation, and achieve targets under the current allocation of Rs 10,000 crore," the second source said.
Moneycontrol could not independently verify the report.
They added that the Department of Heavy Industries (DHI), which implements the FAME scheme is also "in favour" of the extension of FAME II which began on April 1, 2019, and will end on March 31, 2022.
FAME I ran from April 1, 2015, and was extended till March 31, 2019. The scheme aims to improve India’s charging infrastructure for EVs and support the electrification of public transport. It will also help reduce vehicle emission and dependence on fossil fuels.
The report noted that the new considerations come as the Ministry of Heavy Industries and Public Enterprise modified the scheme on June 11 to allot the demand aggregation of e-three-wheelers and e-buses to the state-run Energy Efficiency Services (EESL).
EESL has plans to supply 2 lakh e-two-wheelers and 3 lakh e-three-wheelers at half their current prices using incentives offered under FAME II scheme, state government subsidies, support from EV manufacturers and carbon credits earned from the UN Clean Development Mechanism (CDM), the report said.
The Ministry and NITI Aayog did not respond to queries, it added.
The budget allocation for FAME II is Rs 10,000 crore till March 2022, with plans for Rs 818 crore expenditure till March 2021. Budget sought for 2021-22 is Rs 1,893 crore, 2022-23 is Rs 3,775 crore and 2023-24 is Rs 3,514 crore, bringing the total to Rs 9,182 crore.
The Centre has goals to make India an “EV manufacturing hub” and as such has offered Rs 18,100 crore for the sector under the production linked incentive (PLI) scheme and Rs 45,000 crore to attract investments for advanced chemistry cell battery manufacture.