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Electric Vehicle (EV) Subsidies in India: A Complete Guide
- Nikita
- May 22
- 6 min read
Electric vehicles (EVs) are becoming popular in India, thanks to government subsidies that make them more affordable. These subsidies help reduce pollution, save fuel costs, and promote green transportation. This blog explains everything you need to know about EV subsidies in India, including how much subsidy you can get, available schemes, how to apply, required documents, benefits, state-specific subsidies, and answers to common questions.
Table of Contents
What Are Electric Vehicle(EV) Subsidies?
EV subsidies are financial incentives provided by the Indian government to make electric vehicles cheaper for buyers. The goal is to encourage people to switch from petrol and diesel vehicles to eco-friendly EVs, reducing air pollution and fuel dependency. Subsidies are offered by both the central government and state governments, and they vary based on the vehicle type and state policies.
Government Schemes for Electric Vehicle Subsidies
The Indian government has launched several schemes to promote EVs. Here are the main ones:
FAME-II (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles):
Launched in April 2019 with a budget of ₹10,000 crore, extended until March 2024.
Supports 10 lakh electric two-wheelers, 5 lakh three-wheelers, 55,000 four-wheelers, and 7,000 e-buses.
Focuses on demand incentives, charging infrastructure, and R&D for EVs.
PM E-DRIVE Scheme:
Launched on October 1, 2024, with a budget of ₹10,900 crore, running until March 2026.
Replaces the Electric Mobility Promotion Scheme (EMPS) 2024.
Provides upfront incentives for e-two-wheelers, e-three-wheelers, e-ambulances, e-trucks, and other EVs.
Includes ₹3,679 crore for demand incentives and supports 24.79 lakh e-two-wheelers, 3.16 lakh e-three-wheelers, and 14,028 e-buses.
State-Level EV Policies:
Many states offer additional subsidies, road tax waivers, and registration fee exemptions.
Examples include Delhi, Gujarat, Maharashtra, and Haryana, with varying incentives based on state policies.
PLI Scheme for Advanced Chemistry Cell (ACC) Battery Storage:
Launched to boost domestic battery manufacturing, supporting the EV ecosystem.
Budget of ₹18,100 crore to encourage investment in battery production.
SPMEPCI (Scheme to Promote Manufacturing of Electric Passenger Cars in India):
Approved in March 2024 to promote EV manufacturing and attract global companies like Tesla.
Focuses on sustainable mobility and economic growth.
Subsidy Amounts for Different Electric Vehicle
The subsidy amount depends on the vehicle type, battery capacity, and scheme. Below is a summary based on the latest information:
Vehicle Type | Scheme | Subsidy Amount |
Two-Wheelers | PM E-DRIVE | ₹5,000 per kWh (up to ₹10,000 in Year 1, ₹5,000 in Year 2) |
Two-Wheelers | FAME-II | ₹15,000 per kWh (up to 40% of vehicle cost, capped at ₹30,000 in some states) |
Three-Wheelers | PM E-DRIVE | ₹25,000 (Year 1), ₹12,500 (Year 2); ₹50,000 for L5 cargo three-wheelers (Year 1) |
Three-Wheelers | FAME-II | Up to ₹50,000 based on battery capacity and state policies |
Four-Wheelers | FAME-II | ₹10,000 per kWh (up to ₹1.5 lakh for cars under ₹15 lakh) |
Four-Wheelers | State Policies | Up to ₹6 lakh (Haryana), ₹2.5 lakh (Maharashtra), ₹1 lakh (UP) |
E-Buses | PM E-DRIVE | ₹20,000 per kWh for state transport units, subject to bidding |
E-Buses | FAME-II | Up to ₹20 lakh for buses under ₹2 crore |
Note:
State-specific subsidies vary. For example, Delhi offers up to ₹30,000 for two-wheelers and ₹1.5 lakh for four-wheelers, while Gujarat offers ₹20,000 for two-wheelers and ₹50,000 for three-wheelers.
Road tax and registration fee exemptions are available in most states, like Karnataka, Tamil Nadu, and Telangana.
State-Specific Electric Vehicle Subsidies
Many states in India offer additional subsidies and incentives to complement central schemes like FAME-II and PM E-DRIVE. These state-specific benefits vary based on vehicle type, battery capacity, and policy duration. Below is a table summarizing subsidies and incentives for key states, along with road tax and registration fee exemptions:
State | Two-Wheeler Subsidy | Three-Wheeler Subsidy | Four-Wheeler Subsidy | Other Incentives |
Delhi | ₹5,000/kWh (up to ₹30,000) | ₹30,000 | ₹1.5 lakh (first 1,000 buyers, now exhausted) | 100% road tax and registration fee waiver, ₹5,500 for e-cycles, ₹15,000 for e-cargo cycles |
Maharashtra | ₹5,000/kWh (up to ₹10,000) + ₹15,000 early bird (until 2021) + ₹7,000 scrappage | ₹30,000 | ₹5,000/kWh (up to ₹2.5 lakh with early bird/scrappage) | 100% road tax and registration fee waiver, 25% subsidy on charging equipment |
Haryana | Up to ₹15,000 | Up to ₹50,000 | Up to ₹6 lakh | 100% road tax and registration fee waiver |
Gujarat | ₹10,000/kWh (up to ₹20,000) | ₹50,000 | ₹10,000/kWh (up to ₹1.5 lakh) | 50% road tax, 100% registration fee waiver, ₹10 lakh for charging stations |
Uttar Pradesh | 15% of ex-factory cost (up to ₹5,000) | 15% of ex-factory cost (up to ₹12,000) | 15% of ex-factory cost (up to ₹1 lakh) | 100% road tax waiver (first 3 years), 75% thereafter |
Odisha | ₹5,000 flat subsidy | Up to ₹30,000 | Up to ₹1 lakh | 100% road tax and registration fee waiver |
Meghalaya | ₹10,000/kWh (up to ₹20,000) | ₹30,000 | ₹4,000/kWh (up to ₹60,000) | 100% road tax and registration fee waiver |
Assam | ₹10,000/kWh (up to ₹20,000) | ₹30,000 | ₹10,000/kWh (up to ₹1.5 lakh) | 100% road tax and registration fee waiver |
West Bengal | ₹10,000/kWh (up to ₹20,000) | ₹30,000 | ₹10,000/kWh (up to ₹1.5 lakh) | 100% road tax and registration fee waiver |
Karnataka | No direct subsidy | No direct subsidy | No direct subsidy | 100% road tax and registration fee waiver, subsidies for EV manufacturing |
Tamil Nadu | No direct subsidy | No direct subsidy | No direct subsidy | 100% road tax and registration fee waiver |
Telangana | No direct subsidy | No direct subsidy | No direct subsidy | 100% road tax and registration fee waiver, 5% ex-showroom discount until 2027 |
Andhra Pradesh | No direct subsidy | No direct subsidy | No direct subsidy | 100% road tax and registration fee waiver, 5% ex-showroom discount until 2027 |
How to Apply for EV Subsidies
The process to apply for EV subsidies is straightforward and usually handled by the dealer or manufacturer. Here’s how it works:
Choose an Eligible EV:
Select a vehicle that meets the scheme’s criteria (e.g., minimum top speed of 40 km/h, range of 80 km, lithium-ion battery, and 50% locally sourced components for FAME-II).
Purchase from an Authorized Dealer:
The dealer quotes the price after deducting the subsidy amount. For example, if an EV costs ₹1 lakh and the subsidy is ₹30,000, you pay ₹70,000.
Dealer Submits Details:
The dealer forwards purchase details to the Original Equipment Manufacturer (OEM).
The OEM submits the details to the National Automotive Board (NAB) for verification under FAME-II or to the relevant authority for PM E-DRIVE.
Verification and Disbursement:
After verification, the subsidy is credited to the OEM, who passes it to the dealer, reducing your cost.
For PM E-DRIVE, buyers may receive e-vouchers to claim incentives directly.
State-Specific Process:
Some states, like Uttar Pradesh, have online portals (e.g., upevsubsidy.in) for direct applications.
You may need to submit documents and an affidavit if applying as an individual.
Tip: Check with your dealer for the latest subsidy details and confirm if the vehicle is eligible under FAME-II or PM E-DRIVE.
Documents Required for Electric Vehicle Subsidy Application
The documents needed may vary by state and scheme, but generally include:
Identity Proof: Aadhaar card, passport, or any government-issued ID.
Address Proof: Utility bill, voter ID, or Aadhaar card.
Vehicle Documents: Registration Certificate (RC), invoice, and insurance papers.
Income Certificate: Required in some states to verify eligibility.
Affidavit: In states like Uttar Pradesh, an affidavit on ₹100 non-judicial stamp paper may be needed if applying as an individual (e.g., correcting aggregator/fleet operator selection).
Bank Details: For direct subsidy transfers in some cases.
Always check with the dealer or state EV subsidy portal for specific requirements.
Benefits of EV Subsidies
EV subsidies offer several advantages for buyers and the environment:
Lower Purchase Cost:
Subsidies reduce the upfront cost of EVs by up to 40%, making them competitive with petrol/diesel vehicles.
Tax Benefits:
Up to ₹1.5 lakh tax exemption under Section 80EEB for EV loans (for personal use).
Reduced GST on EVs (5%) and charging stations (5%) compared to 12% for petrol/diesel vehicles.
Savings on Fuel and Maintenance:
EVs cost less than ₹1 per km to run, compared to ₹2.5–3 for petrol vehicles.
Fewer components mean lower maintenance costs (no oil or filter changes).
Environmental Impact:
EVs produce zero tailpipe emissions, reducing air pollution and greenhouse gases.
Supports India’s goal of 30% EV sales by 2030 and net-zero emissions by 2070.
State Incentives:
Waivers on road tax and registration fees in states like Delhi, Karnataka, and Tamil Nadu.
Additional subsidies in states like Haryana (up to ₹6 lakh for cars) and Maharashtra (up to ₹2.5 lakh).
Support for Businesses:
Subsidies for e-ambulances, e-trucks, and e-buses help businesses and public transport adopt EVs.
Conclusion
Electric vehicle subsidies in India are a game-changer for both buyers and the environment. With schemes like FAME-II and PM E-DRIVE, along with state-specific incentives, EVs are now more affordable than ever. These subsidies not only lower the cost of buying an EV but also save money on fuel and maintenance while helping reduce air pollution. Whether you’re an individual looking for a two-wheeler or a business investing in e-buses, these incentives make it easier to switch to green mobility.
To get started, visit an authorized dealer, check your eligibility, and explore state-specific policies. For the latest details, visit the e-AMRIT portal. Embrace the future of transportation with EVs and contribute to a cleaner, greener India!
Frequently Asked Questions About Electric Vehicle
Who can apply for EV subsidies in India?
Anyone buying an eligible EV (two-wheeler, three-wheeler, four-wheeler, or e-bus) can avail subsidies. The vehicle must meet criteria like minimum speed, range, and battery type. Check with your dealer for eligibility.
How much subsidy can I get for an electric scooter?
Under PM E-DRIVE, you can get ₹5,000 per kWh (up to ₹10,000 in Year 1). Under FAME-II, it’s ₹15,000 per kWh (up to ₹30,000 in some states). State subsidies may add more.
Do I need to apply for the subsidy myself?
Usually, the dealer handles the process by submitting details to the OEM and NAB. In some states, you may need to apply directly via online portals like upevsubsidy.in.
What happens if my subsidy application is rejected?
Check for errors like incomplete documents or ineligibility. Correct the issues and reapply. Contact the dealer or state authorities for guidance.
Are there subsidies for electric cars?
Yes, FAME-II offers ₹10,000 per kWh (up to ₹1.5 lakh) for cars under ₹15 lakh. States like Haryana and Maharashtra offer up to ₹6 lakh and ₹2.5 lakh, respectively.
Can businesses avail EV subsidies?
Yes, subsidies are available for commercial vehicles like e-rickshaws, e-buses, and e-trucks under FAME-II and PM E-DRIVE. Check with the OEM for details.
Why are EV subsidies important?
They make EVs affordable, reduce pollution, save fuel costs, and support India’s goal of sustainable mobility.
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