Centre notifies PM E-DRIVE Scheme with ₹10,900 crore outlay. Here's a list of who stands to gain

The Centre on Monday notified the PM E-DRIVE scheme, allocating ₹10,900 crore for the promotion of electric vehicles (EVs) and the development of charging infrastructure and manufacturing capabilities. 

The scheme will run from October 1 to March 31, 2026, and aims to accelerate the country’s shift towards electric mobility.

The PM E-DRIVE will absorb the ongoing Electric Mobility Promotion Scheme (EMPS) 2024, merging its budget and vehicle targets into the new framework. 

“The number of vehicles and the expenditure under EMPS, 2024 is subsumed under the PM E-DRIVE Scheme,” the official notification confirmed.

Subsidies will be offered for various categories of EVs, including two- and three-wheelers, e-ambulances, and e-trucks. 

Grants will also be available for building charging infrastructure, supporting e-bus fleets, and upgrading testing facilities. Notably, electric buses will receive a significant portion of the funding, with ₹4,391 crore set aside for them, while two-wheelers are allocated ₹1,772 crore.

State governments are expected to play a crucial role by providing additional incentives. The scheme encourages states to offer fiscal and non-fiscal incentives, such as road tax concessions, toll exemptions, and parking fee reductions to further promote EV adoption. “States need to offer a bouquet of fiscal and non-fiscal incentives,” the notification stated, listing several possible benefits.

The scheme also introduces a Phased Manufacturing Programme (PMP) to boost the local production of EV components. From December 2024, EV chargers must meet a minimum 50% domestic value addition (DVA) requirement to qualify for subsidies.

Financial support for electric two-wheelers will be halved to ₹5,000 per vehicle by 2025-26, while three-wheeler subsidies will be capped at ₹25,000 per vehicle. In response to past issues with subsidies being misused under the earlier FAME scheme, the government has tightened regulations to prevent companies from benefiting while selling imported vehicles.