The government of India has launched a scheme to promote use of eco-friendly vehicles.
FAME India, or Faster Adoption and Manufacturing of Hybrid and Electric vehicles in India, was formally launched on Wednesday.
Under the scheme, the government is offering incentives up to Rs 29,000 on bikes and up to Rs 1.38 lakh on cars.
Similarly, three-wheeler buyers will benefit from reduction in cost up to Rs 61,000 and bus purchasers will benefit from up to Rs 66 lakh less the cost price.
A sum of Rs 795 crore has been set aside for implementation of phase-1 of the scheme of which Rs 500 crore will go into meeting expenditure on demand incentives.
The heavy industries ministry anticipates total expenditure of Rs 14,000 crore for the implementation of the scheme.
Phase 1 of FAME India, which is part of National Electric Mobility Mission Plan, will extend support to buyers during the fiscal years 2015-16 and 2016-17. The scheme will be provided Rs 260 crore and Rs 535 crore respectively during the two years.
The funds would be used to develop the technology platform (including testing infrastructure), charging infrastructure and pilot project besides meeting demand incentives.
Further, FAME India will be reviewed in 2017 and re-implemented with necessary funds if found viable.
According to India’s heavy industries minister Anant Geete, the scheme would be launched in smart cities first and subsequently extended to all major cities of India.
“The customer benefits from the lower cost of hybrid or electric vehicles. And manufacturers can claim the incentive from the government at the end of each month,” Geete said.
Reports suggest Tata Motors, Maruti Suzuki and several other players in the market are planning to come out with new models to cater to the demand for hybrid and electric vehicles.
Economic Times, taking Mahindra Reva’s small electric car e20 as an example has reported that FAME India scheme will reduce the cost of the car by Rs 1.24 lakh.
At present the vehicle costs Rs 7.19 lakh and Rs 7.67 lakh (ex-showroom Delhi).
Ajith Kumar S