PM E-DRIVE Initiative Launched with ₹10,900 Crore Budget for Electric Vehicles

Prime Minister Narendra Modi's government has introduced a groundbreaking initiative to enhance the adoption of electric vehicles (EVs) across India. This new program, named the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE), is set to play a pivotal role in transitioning the nation toward sustainable transportation. With a significant financial commitment of ₹10,900 crore, the scheme aims to accelerate the growth of the electric vehicle market in India.

Implementation Timeline

The PM E-DRIVE scheme is officially set to launch on October 1, 2024, and will remain active until March 31, 2026. The total budget of ₹10,900 crore will be allocated over two financial years, with ₹5,047 crore designated for FY 2024-25 and ₹5,853 crore for FY 2025-26. This strategic financial planning underscores the government's commitment to making electric vehicles more accessible and appealing to consumers.

Objectives of the PM E-DRIVE Scheme

The primary goal of the PM E-DRIVE scheme is to boost the adoption of electric vehicles, particularly focusing on electric two-wheelers (e-2Ws), electric three-wheelers (e-3Ws), and other electric vehicles. To further enhance the EV ecosystem, the scheme will provide grants aimed at creating capital assets, including:

• The purchase of electric buses

• Establishment of a comprehensive network of charging stations

• Upgrading of testing facilities identified under this initiative

By addressing these critical areas, the scheme aims to build a robust infrastructure that supports electric vehicle usage across the country.

Transition from Previous Schemes

The PM E-DRIVE scheme succeeds the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME-II) scheme, which was instrumental in promoting electric mobility since its inception. Launched in 2015, the FAME-I initiative began with an initial budget of ₹795 crore, later extended to ₹895 crore. In 2019, the government introduced FAME-II, initially budgeted at ₹10,000 crore, which was subsequently increased to ₹11,500 crore to extend its support for electric vehicles until March 2024.

Additionally, the Electric Mobility Promotion Scheme 2024 (EMPS-2024) was introduced with a budget of ₹778 crore to facilitate the promotion of electric mobility from April 1, 2024, to September 30, 2024. The PM E-DRIVE scheme effectively consolidates and expands upon the objectives of the ongoing EMPS-2024 initiative.

Key Features and Financial Allocations

One of the most significant components of the PM E-DRIVE scheme is the introduction of demand incentives, which aim to reduce the acquisition costs of electric vehicles for consumers. For the financial year 2024-25, the scheme proposes a demand incentive of ₹5,000 per kWh for electric two-wheelers and three-wheelers. This incentive will decrease to ₹2,500 per kWh in FY 2025-26.

A substantial portion of the total outlay, approximately ₹8,070 crore, is specifically earmarked for supporting electric vehicles. This includes:

• ₹4,391 crore allocated for electric buses

• ₹1,772 crore designated for electric two-wheelers

This targeted funding is intended to facilitate the widespread adoption of electric vehicles and support manufacturers in producing these eco-friendly alternatives.

Infrastructure Development and Support

As part of the PM E-DRIVE initiative, the central government aims to facilitate the purchase of over 14,000 electric buses and establish a network of 2,000 charging stations across India. Furthermore, the initiative includes upgrading existing EV testing facilities to ensure safety and compliance with regulatory standards.

The scheme also allocates ₹7,171 crore specifically for capital asset creation. This investment is designed to incentivize states to provide additional support, both fiscal and non-fiscal, to further promote electric vehicle adoption at the regional level.

Conclusion

The PM E-DRIVE scheme marks a significant milestone in India's journey toward sustainable transportation. By investing ₹10,900 crore over two years and offering attractive incentives for electric vehicles, the government aims to enhance the overall electric vehicle ecosystem. As the country seeks to reduce its carbon footprint and promote clean energy, the PM E-DRIVE initiative stands as a testament to the government’s commitment to a greener and more sustainable future. With robust financial backing and a clear focus on infrastructure development, the scheme is poised to transform the electric vehicle landscape in India, making it easier and more appealing for consumers to make the switch to electric mobility.