Published on and written by Cyril Jarnias
As India strives to reduce carbon emissions and adopt greener transportation solutions, the development of electric vehicles is taking center stage. The government has rolled out a series of attractive subsidies to encourage the purchase of these vehicles, thereby facilitating the transition toward a more sustainable future.
Simultaneously, the expansion of charging infrastructure continues at a steady pace to meet growing demand and remove barriers to adoption.
This article provides an in-depth exploration of the steps taken to integrate electric vehicles into India’s economic and social fabric, highlighting key initiatives that are shaping the country’s energy landscape.
Steps to Obtain Subsidies for Electric Vehicles in India
Available Subsidies for Purchasing Electric Vehicles in India
- FAME II Program (Faster Adoption and Manufacture of Hybrid and Electric Vehicles): This national program aimed to accelerate the adoption of electric vehicles (EVs) by subsidizing the purchase of electric two-wheelers, three-wheelers, buses, and cars, as well as the installation of charging infrastructure. However, as of March 2024, FAME II subsidies have ended for passenger cars and now focus on electric two-wheelers, three-wheelers, and buses.
- New 2024-2025 Assistance Program: Launched in September 2024, it is funded with 1.2 billion euros and applies only to electric two-wheelers, three-wheelers, and buses. Passenger cars are excluded from this scheme but benefit from a reduced VAT of 5% (compared to 48% for internal combustion vehicles).
- SPMEPCI (Scheme to Promote Manufacturing of Electric Passenger Cars in India): This new program, launched in June 2025, targets the local production of electric passenger cars and primarily focuses on automakers, with incentives for investment and technological innovation. Manufacturers must invest a minimum amount to be eligible.
- Subsidies from Indian States: Several states offer complementary incentives, such as purchase discounts, road tax exemptions, parking facilities, and benefits for charging infrastructure. Terms vary by state.
- EV Mitra Scheme: This program aims to support the establishment of charging stations and offers subsidies for infrastructure installation, available to both individuals and businesses.
Summary Table of Key Subsidies and Incentives
| Program/Scheme | Vehicle Types Covered | Main Beneficiaries | Key Amount/Benefit |
|---|---|---|---|
| FAME II (until March 2024) | 2-wheelers, 3-wheelers, buses, electric cars | Individual/business buyers | Up to 150,000 INR per vehicle |
| New 2024 Program | Electric 2-wheelers, 3-wheelers, buses | Individual/business buyers | Variable subsidies, excluding cars |
| SPMEPCI (2025) | Electric cars (local production) | Automakers | Investment incentives |
| State Subsidies | According to state policy | Local buyers | Discounts, tax exemptions |
| EV Mitra Scheme | Charging infrastructure | Individuals, businesses | Subsidy on installation cost |
Eligibility Criteria
- FAME II & New National Program:
- Purchase of a new, certified electric vehicle.
- The vehicle must be on the approved list by Indian authorities.
- The buyer must be a resident of India (individual or business).
- For manufacturers (SPMEPCI), minimum investment required (e.g., $34 million over 5 years).
- State Subsidies:
- Reside in the concerned state.
- Purchase a vehicle from an authorized dealer in that state.
- EV Mitra Scheme:
- Be the owner or manager of the charging station installation site.
- Provide identity and ownership proof.
Types of Vehicles Covered
- Electric Two-Wheelers (scooters, motorcycles)
- Electric Three-Wheelers (rickshaws, tuk-tuks)
- Electric Buses
- Electric Passenger Cars (primarily for production incentives, limited purchase subsidies)
Application Process and Required Documents
- Choose an eligible vehicle from the official list.
- Fill out the application form on the official portal of the relevant program (e.g., spmepci.heavyindustries.gov.in for SPMEPCI).
- Provide the following documents:
- Proof of identity (Aadhar card, passport…)
- Proof of address (utility bill, lease…)
- Vehicle purchase invoice
- Vehicle registration certificate
- Bank statement for subsidy transfer
- For businesses: registration and investment proofs
- Submit the application online or through an authorized dealer (some states accept paper applications).
- Verification by the competent authority (Ministry of Heavy Industries, state agency…).
- Allocation of the subsidy via bank transfer or immediate reduction on the purchase price.
Role of Government Agencies
- Ministry of Heavy Industries (MHI): Oversees national programs (FAME, SPMEPCI), publishes lists of eligible vehicles, manages application platforms.
- State Transport Departments: Implement local subsidies, issue tax exemptions, and register electric vehicles.
- SMEV (Society of Manufacturers of Electric Vehicles): Participates in coordination between the private sector and government, promotes vehicle compliance.
Success Stories
- Businesses: Tata Motors and Mahindra have heavily invested in local electric vehicle production, benefiting from manufacturing and R&D incentives.
- Individuals: Many residents of Delhi and Bangalore benefit from purchase discounts and tax exemptions for electric scooters, facilitating rapid adoption in these megacities.
- Infrastructure: Startups like Ather Energy and initiatives like the EV Mitra Scheme have enabled the proliferation of publicly accessible charging stations, supported by subsidies and public-private partnerships.
India is multiplying schemes to support electric mobility, combining national subsidies, local manufacturing incentives, and specific assistance in each state. These measures promote the rapid growth of electric vehicles and facilitate the green transition for both individuals and businesses.
Good to Know:
To obtain subsidies for electric vehicles in India, first explore the central government’s FAME II program, which offers financial incentives for electric two, three, and four-wheelers, but be sure to check eligibility criteria such as vehicle type and battery capacity. Each state may offer additional subsidies; for example, Maharashtra and Gujarat top up incentives to further reduce the initial cost. To apply, compile necessary documents such as proof of purchase, vehicle details, and the application form available on relevant government portals. State agencies play a crucial role in allocating these aids and may vary in their requirements, so consulting official websites or information centers is essential to get up-to-date documents. Success stories include companies like Ola Electric that have benefited from incentives to expand their electric fleet or individuals who have significantly reduced vehicle purchase costs through these subsidies, thereby facilitating a faster transition to sustainable mobility.
Green Incentives to Encourage Electric Car Adoption
The Indian government has implemented several green incentives to encourage the adoption of electric vehicles, including financial subsidies, tax benefits, and carbon credit initiatives.
List of Key National Incentives:
- Direct Purchase Subsidies: Buyers benefit from substantial reductions on acquisition prices. For example, under FAME II, the subsidy can reach ₹15,000 per kWh for electric two-wheelers.
- Tax Benefits: Reduction or partial exemption of GST on certain electric models; road tax exemptions in several states.
- Carbon Credits and measures promoting decarbonization of the transport sector.
- Infrastructure support with massive funding to install public charging stations.
Specific Programs Implemented:
| Program | Main Objectives | Allocated Budget | Measured Impact |
|---|---|---|---|
| FAME I (2015–2019) | Generate demand, develop technology | ₹895 crores | 2.8 lakh EVs supported |
| FAME II (2019–2024) | Mass adoption especially in public transport | ₹10,000 – ₹11,500 cr. | >7.6 lakh EVs subsidized >6,300 electric buses deployed |
List of Key FAME Program Objectives:
- Incentivize individuals and public operators to choose an electric vehicle over a combustion vehicle.
- Reduce urban emissions and air pollution.
- Decrease India’s dependence on imported oil.
- Stimulate the local manufacturing sector related to clean vehicles.
Specific Regional Initiatives:
Many Indian states also offer their own complementary programs:
- Additional purchase discounts
- Local tax exemptions/compensations
- Support for rapid development of dedicated infrastructure
Notable Examples of State Initiatives:
- Delhi: Additional financial bonus when registering an EV
- Maharashtra & Tamil Nadu: Additional subsidies + significant tax reductions
Expected Environmental Benefits:
- Significant reduction in CO₂ emissions from road transport
- Direct improvement in air quality in major Indian cities
- Essential contribution to national climate commitments (Paris Agreement)
- Gradual reduction in urban noise thanks to a quieter fleet
The national-regional combination strongly accelerates the Indian electric vehicle market while generating a tangible positive environmental impact.
Good to Know:
In India, the government has implemented several green incentives to encourage the adoption of electric cars, notably through the FAME India program, which offers direct financial subsidies and aims to reduce the cost of electric vehicles for consumers. This program has significantly contributed to the increase in the number of electric vehicles in the country, with sales sharply rising in recent years. Besides subsidies, tax benefits are granted, such as reductions in the Goods and Services Tax (GST) and exemptions from road tax in some states. Regional governments complement these efforts with specific discount programs and additional financial compensations for electric vehicle buyers. Carbon credit initiatives also allow companies to benefit from emission reductions, enhancing the appeal of these vehicles. These measures have not only accelerated the adoption of electric vehicles but also contributed to reducing carbon emissions, offering significant environmental benefits in a country where air pollution is a major issue.
Development of Charging Infrastructure for Electric Vehicles
The Indian government has launched major initiatives to strengthen the electric vehicle charging network, notably through the FAME (Faster Adoption and Manufacturing of Electric Vehicles) program, which grants subsidies for station installation and aims to accelerate the energy transition in transport. By 2030, the goal is for 30% of passenger cars and 80% of newly acquired two-wheelers and three-wheelers to be electric.
Main Government Initiatives:
- FAME Program: Financial support for purchasing electric vehicles and setting up charging infrastructure.
- Pilot projects in 11 cities to integrate electric vehicles into public transport (e.g., buses, taxis, rickshaws).
- National goal: Fully electric vehicle fleet by 2030.
- Promotion of a self-financed model without energy tariff increases or reliance on public budget.
Public/Private Collaboration:
Partnerships between Tata Motors, Mahindra Electric, Kinetic Green Energy, and Ola to deploy several hundred vehicles and their associated stations.
Concrete example: Tata installs 100 charging stations across certain states; Ola created four stations with 53 charging points during the pilot project in Nagpur.
Recent Examples:
| Project | Location | Number / Type | Key Partners |
|---|---|---|---|
| Bengaluru Airport | Bengaluru | 10 ultra-fast chargers | Servotech |
| Nagpur | Maharashtra | 4 stations / 53 charging points | Ola, Mahindra Electric |
| Tata State Rollout | Various States | 100 stations | Tata Motors |
Challenges Encountered:
Integration with Existing Infrastructure
- Lack of dedicated spaces for parking and plugging in major cities
- Need to adapt railway networks and urban roadways
Managing Growing Energy Demand
- Risk to the power grid during usage peaks
- Need for smart solutions to balance supply/demand
Proposed Technological Solutions
- Mass deployment of fast chargers (>150 kW)
- Testing on electrified roads allowing dynamic charging via induction (notably pilot projects in India)
- Integrated digital platforms facilitating centralized management of the electric vehicle fleet (e.g., Ola platform)
Recent Statistics:
- Over 1,000 new public points installed in less than a year thanks to public/private partnerships
- Estimated annual growth exceeding 40%, driven by urban megaprojects
Iconic Pilot Projects:
- Nagpur: Full integration with over 200 electric vehicles, including taxis & rickshaws
- Bengaluru Airport: Largest airside hub with ultra-fast chargers for professional fleets
These models are gradually being replicated in other Indian metropolises to accelerate national electrification while adapting each local solution to regional energy constraints.
Good to Know:
In India, the government has recently intensified efforts to expand electric vehicle charging infrastructure with initiatives such as creating charging corridors on highways and granting subsidies for installing charging points in urban areas. Partnerships with private companies like Tata Power and Reliance have been established to accelerate the installation of charging stations. However, challenges remain, including integration into existing infrastructure and managing increasing energy demand. Technological solutions, such as fast-charging systems and the combined use of solar and wind power, are being explored to address these issues. To date, over 1,500 charging points have been installed, with pilot projects like the one in Nagpur serving as a model for wider dissemination across the country.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
