₹ 500 crore Electric Mobility Promotion Scheme Announced For EV Push

The Ministry of Heavy Industries plans to expand sales and promote EV manufacturing via this new scheme.

In a major boost to electric two-wheelers and three-wheelers sold in India, the Ministry of Heavy Industries (MHI) announced a special scheme. Under the Electric Mobility Promotion Scheme (EMPS) 2024, the government has allotted ₹ 500 crore for electric two-wheelers and three-wheelers sold in our country. The Electric Mobility Promotion Scheme 2024 will be implemented over a period of four months and will be effective from April 1, 2024 to 31 July, 2024. The motive of this new scheme is to improve the sales of electric two wheeler (e2W) and three wheelers, while also promoting the manufacturing of electric vehicles in our country. Acko Drive got in touch with various manufacturers for an official quote regarding EMPS and this article will be updated with those as and when we shall receive them.

Electric two-wheeler sales witnessed an upswing in the past few months as manufacturers introduced cheaper variants and offered many benefit schemes to customers. EV brands resorted to this strategy as many state subsidies were removed and this resulted in prices of electric two-wheelers increasing. Another reason for the jump in sales is the fear that Fame-II subsidy will be removed completely and that could result in a price hike. 

But with the introduction of the Electric Mobility Promotion Scheme (EMPS) ideally should boost the confidence of prospective buyers as the criteria for both the schemes is the same. This means manufacturers will not be required to re-engineer their products to meet the EMPS criteria. Whether EV brands will have to recertify their products remains to be seen. 

Just to give our readers an e.g. of the boom in sales, EV brands sold 81,343 electric two-wheeler units in January 2024 (26% YoY growth), while February 2024 sales stood at 81,963 units (24% YoY). It’s likely that EMPS could play a crucial role in maintaining this positive run of EV sales in the future and we will have to verify the April 2024 sales to gauge its impact. 

The following table gives us a clear breakup of fund allocation and maximum number of vehicles to be supported by EMPS. :

Earlier in February 2024, the government had raised the Fame-II allocation to ₹ 11,500 crore. The Fame-II scheme was supposed to be valid till March 31, 2024, or till the time funds under this scheme were available. Fame-II scheme has been very instrumental in promoting sales of electric vehicles in India as according to data available, it’s claimed that the government has offered subsidies on 1.2 million two-wheelers, 1,41,000 three-wheelers and close to 17,000 four-wheelers.