Govt Resumes Subsidies To Electric Two-wheeler Brands

The Indian government has resumed the subsidy under the FAME 2 scheme to EV makers Ola Electric, Ather Energy, TVS, and Vida, the cumulative amount of which is over Rs 500 crore. Here are the details: 

We recently covered that EV manufacturers Ola Electric, Ather, TVS Motors and Vida had come on the government’s radar for allegedly exploiting loopholes in the FAME 2 policy. More specifically, they were selling the chargers as well as proprietary software separately as accessories, thereby meeting the Rs 1.5 lakh ex-showroom threshold to avail the subsidy. This led to the FAME 2 subsidy to these manufacturers being temporarily halted. As a result, the manufacturers issued refunds to existing customers.  

With that done, the government has now resumed the FAME 2 subsidy to the four EV two-wheeler manufacturers. The biggest payout, of roughly Rs 370 crore, will go to Ola, while around Rs 275 crore will go to Ather. And while TVS will likely be reimbursed to the tune of Rs 150 crore, Hero Motocorp (Vida) will receive Rs 30 crore. 

Summing up, the FAME 2 applies to electric two-wheelers that can go a minimum of 80km on a single charge, attain a top speed of at least 40kmph, and should be made up of at least 50 percent local raw materials. Speaking of which, the recent discovery of lithium reserves in Jammu and Kashmir may reduce the cost of batteries, which could make electric vehicles a bit more affordable, and increase their adoption in smaller towns and cities.