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Govt Revises PM E-DRIVE Scheme, Announces Fresh Incentives for E-Rickshaws, E-Carts and L5 E-3 Wheelers


By Robin Kumar AttriUpdated On: 19-Aug-2025 05:19 AM
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ByRobin Kumar AttriRobin Kumar Attri |Updated On: 19-Aug-2025 05:19 AM
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Govt revises PM E-DRIVE scheme with reduced subsidies for e-rickshaws, e-carts, and L5 e-3Ws. Funding capped at ₹50 crore and ₹857 crore for FY24-26.
Govt Revises PM E-DRIVE Scheme, Announces Fresh Incentives for E-Rickshaws, E-Carts and L5 E-3 Wheelers

Key Highlights

  • ₹50 crore cap for e-rickshaws and e-carts.

  • ₹12,500 per vehicle subsidy for FY25-26.

  • ₹857 crore allocated for L5 e-3Ws.

  • ₹50,000 subsidy till Nov 7, 2024.

  • Reduced ₹25,000 subsidy till March 31, 2026.

The Ministry of Heavy Industries has announced revised incentives under the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme. The changes impact electric rickshaws, e-carts, and L5 category e-3 wheelers, with updated subsidy amounts and capped funding allocations for FY 2024-26.

Updated Incentives for E-Rickshaws and E-Carts

Under the new revision, support for e-rickshaws and e-carts is capped at ₹50 crores. For FY25-26, the subsidy has been reduced to ₹2,500/kWh, with a maximum cap of ₹12,500 per vehicle.

Earlier, for FY24-25, vehicles were eligible for ₹5,000/kWh, capped at ₹25,000 per vehicle, but the revised scheme reduces the benefits for new registrations in the next financial year.

Revised Funding for L5 Category E-3 Wheelers

The government has earmarked ₹857 crores for L5 category e-3 wheelers. The incentives will differ depending on the registration timeline:

  • Registrations between April 1, 2024, and November 7, 2024: Vehicles will receive ₹5,000/kWh, capped at ₹50,000 per vehicle.

  • Registrations from November 8, 2024, to March 31, 2026: Vehicles will be eligible for reduced support of ₹2,500/kWh, capped at ₹25,000 per vehicle.

This adjustment ensures a calibrated reduction in incentives over time, aligning with market growth and cost reductions in the EV sector.

Key Features of the PM E-DRIVE Scheme

The PM E-DRIVE Scheme, first announced in September 2024 with an outlay of ₹10,900 crore, aims to accelerate India’s shift towards electric mobility. The scheme covers multiple EV categories, including e-2Ws, e-3Ws, e-ambulances, e-trucks, and e-buses.

Key allocations include:

  • ₹3,679 crore for demand incentives.

  • ₹7,171 crore for e-buses, charging infrastructure, and testing upgrades.

  • Support for 24.8 lakh e-2Ws, 3.2 lakh e-3Ws, and 14,028 e-buses.

  • Funding of 72,300 charging points across the country.

Government’s Objective

According to the ministry, the updated scheme is designed to balance financial support with market needs. By gradually reducing subsidies, the government aims to encourage EV adoption while accounting for declining vehicle costs.

Industry Advisory

The ministry has advised industry stakeholders, EV manufacturers, and users to stay updated with registration timelines to maximize benefits under the scheme. Delays in registration may lead to reduced subsidies as per the revised structure.

Also Read: Rechargion Energy’s Sodium-Ion Battery Gets Safety Validation from ARAI

CMV360 Says

The revised PM E-DRIVE scheme highlights the government’s focus on balancing EV adoption with sustainable financial support. By lowering incentives gradually, it encourages faster registrations while ensuring long-term growth in India’s electric mobility sector. With allocated funds for e-rickshaws, e-carts, and e-3Ws, the scheme is set to strengthen clean transport and urban mobility in the coming years.

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