In its latest amendment notified, the Ministry of Heavy Industries has extended the PM E-Drive scheme period by two years without adding a rupee to the funds available.
Also, the extended two-year period will be applicable only to vehicle categories like e-buses, e-trucks and e-ambulances, leaving electric two- and three-wheelers out. For the latter categories, the subsidy regime ends as originally envisaged on March 31, 2026.
The tweaks in the PM E-Drive scheme come even as a plea by the two-wheeler OEMs (ICE as well as electric), on waiving domestic value addition (DVA) norms due to the ongoing shortage of rare earth magnets, remains unaddressed.
In a nutshell, purchase subsidies available to electric two-wheelers and three-wheelers will be discontinued by March 2026 and there is no resolution feasible till now on production hiccups currently due to magnet shortages.
These vehicles play an important role in public transport and essential services, and increasing their adoption will help improve air quality, reduce emissions and increase adoption of electric vehicles across all cities in IndiaSaurabh Agarwal
Saurabh Agarwal, Partner & Automotive Tax Leader, EY India called the extension of PM E-Drive “a timely and focused move by the government to support electric mobility in high-impact areas like electric buses, trucks, and ambulances. These vehicles play an important role in public transport and essential services, and increasing their adoption will help improve air quality, reduce emissions and increase adoption of electric vehicles across all cities in India.”
The amendment:
In partial modification of the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-Drive) scheme, which was notified in September 2024, two amendments have been notified this afternoon:
1) Para 5 of the scheme notification of S.O. 4259(E) dated September 29, 2024 shall stand amended as under: The PM E-Drive Scheme, with an outlay of ₹10,900 crore, shall be implemented from October 1, 2024 to March 31, 2028, for faster adoption of electric vehicles (EVs), setting up of charging infrastructure and development of EV manufacturing eco-system in the country. Further, EMPS-2024 being implemented for the period from April 1, 2024 to September 30, 2024 is subsumed under this scheme.
2) Para 46 of the scheme notification of S.O. 4259(E) dated September 29, 2024 shall stand amended as under: This is a fund limited scheme. Total payout under the scheme shall be limited to the scheme outlay of ₹10,900 crore. In case the funds for the scheme or its relevant sub-components are exhausted prior to the terminal date of the scheme i.e. March 31, 2028, then the scheme or its relevant subcomponents will be closed accordingly i.e. no further claims will be entertained. However, the terminal date for registered e-2W, registered e-rickshaws & e-cart and registered…
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