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Details of India’s FAME III will be announced by the new government after the general election

On 31 March 2024, the Government of India ended FAME II, a measure to accelerate the spread and production of electric vehicles.

FAME II commenced in April 2019 and by the end of March 2024, approximately 1.37 million electric two-wheelers had benefited from subsidies to promote the electrification of two-wheelers in the country.

The details of FAME III, which will cover the period from April 2024 onwards, will be announced in detail by the new government, which will be formed after the general election, which will be held on 4 June, with voting commencing on 19 April. According to local reports, the provisional budget for FAME III is Rs 26.7 billion, which is 44% less than the budget for the period April 2023 to March 2024, but is likely to be increased.

As a bridging measure until the introduction of FAME III, the Government of India has introduced the Electric Mobility Promotion Scheme 2024 (EMPS2024) with a budget size of Rs 5 billion for electric two/three wheelers for the period 1 April to 31 July 2024. The scheme has a budget allocation of R3.33 billion for electric two-wheelers and R340 million for electric three-wheelers. The purchase subsidy amount for electric two-wheelers is R5 000 per kWh of battery with a ceiling of R10 000 for products with a factory price of R150 000 or less. At the maximum purchase subsidy amount of R10 000, this translates to approximately 330 000 electric two-wheelers eligible for subsidy payments.

The subsidy amount was significantly reduced in June 2023 from R15 000 to R10 000 per kWh and the maximum amount from R60 000 to R225 000. This subsidy will be further reduced by less than half. Electric two-wheeler manufacturers have used last year’s subsidy reduction as an opportunity to control the increase in selling prices by introducing products with lower battery capacity to make the most of the subsidy. The introduction of low-cost models with low battery capacity is expected to become even more active in the future.

This report will report on the current state of electric motorcycle sales in India and other major motorcycle market countries and the electric vehicle business strategies of major manufacturers, as well as forecasting 2035 electric motorcycle sales and production in each country.