PM e-Drive scheme will boost local EV manufacturing

New Delhi| The PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM e-Drive) scheme, recently approved by the Union Cabinet to increase the trend of electric vehicles in the country, will have a program to increase the manufacturing of EV equipment at the local level. PM e-Drive Yojana will replace FAME Scheme. The government has sanctioned Rs 10,900 crore for this scheme. Several media reports have said that under the PM e-Drive scheme, a phased manufacturing program (PMP) will be implemented to increase the manufacturing of EV equipment in the country.

Under the scheme, EV manufacturers, who source equipment locally, will receive financial assistance without domestic value addition requirement. To get subsidy, parts of EV equipment will have to be assembled locally. However, suppliers can import parts.

The report quoted a senior official as saying that local EV manufacturing will be promoted under the PMP. To get subsidy under this, companies will have to comply with the PMP rules within six months of the release of the notification of the scheme. He further said that the subsidized companies will have to ensure that EV equipment is being manufactured in India only.

The report reported that financial support for electric two-wheelers would be reduced to Rs 5,000 per vehicle and subsidies for three-wheelers to Rs 25,000 per vehicle in 2025-26. In the report, another official said that the manufacturing facility of the company supplying EV equipment will be inspected twice a year, so that the subsidy is not misused.