Government Extends EMPS Subsidy for Electric Vehicles Until September 2024

Key Highlights:

• The EMPS subsidy on electric vehicles is extended until September 30, 2024.
• The budget for this subsidy has been increased from Rs 500 crore to Rs 778 crore.
• The number of eligible electric vehicles has increased from 3,33,387 units to 5,00,080 units.
• The subsidy covers Rs 5,000 per kWh of battery capacity, capped at 15% of the vehicle’s factory price or Rs 10,000.
• Electric two-wheelers must be made in India, have local manufacturing for key parts, and offer a minimum warranty of 3 years or 20,000 km.

The Electric Mobility Promotion Scheme (EMPS) subsidy for electric bikes and scooters has been extended until September 30, 2024, according to the Ministry of Heavy Industries (MHI). The subsidy was initially implemented in March 2024 and was valid until July 31st, 2024.

With this extension, the government decided to increase the budget for this initiative. The budget was originally Rs 500 crore, but it has now been raised to Rs 778 crore.

More Electric Vehicles Eligible

When the subsidy was first introduced, 3,33,387 electric vehicles were eligible. Now, this number has increased to 5,00,080 units.

Subsidy Details

The subsidy covers Rs 5,000 per kWh of the total battery capacity, capped at 15 per cent of the vehicle’s factory price, with a maximum subsidy of Rs 10,000. This scheme replaced the FAME 2 subsidy, which expired on 31st March 2024.

Criteria for EV Manufacturers

To avail the subsidy, manufacturers must meet the following criteria:

• The electric vehicle must be manufactured in India.
• Manufacturers must have local manufacturing and assembly plants for parts like DC-DC converters, batteries, motors, and instrument consoles.
• The minimum vehicle warranty should be 3 years or 20,000 km, whichever comes first.

The scheme is designed to promote the government's green initiatives and support the expansion of the electric vehicle (EV) manufacturing industry in the nation. 

The scheme covers eligible EV categories such as electric two-wheelers and three-wheelers, including registered e-rickshaws, e-carts, and L5 category vehicles.

Focus on Affordable Public Transportation

With a greater emphasis on providing affordable and environmentally friendly public transportation options for the masses, the scheme will mainly apply to e-2Ws and electric three wheelers registered for commercial purposes. Additionally, privately or corporate-owned registered e-2Ws will also be eligible under the scheme.

The Electric Mobility Promotion Scheme (EMPS) - 2024 is expected to further promote green mobility and the development of the electric vehicle (EV) manufacturing ecosystem in the country.

Also Read: Budget 2024: No Major Boost for the Electric Vehicle Industry

CMV360 Says

The extension of the EMPS subsidy is a positive step that will provide much-needed relief to electric two-wheeler manufacturers and encourage potential customers to choose electric vehicles. However, this is a short-term solution. Once the subsidy ends, EV prices will rise, which may affect smaller manufacturers who are not prepared for such financial changes.