The Centre has officially notified the PM E-DRIVE scheme with a total outlay of US$ 1.30 billion (Rs. 10,900 crore). According to the gazette notification, the scheme will be implemented from October 1, 2024, to March 31, 2026, focusing on the faster adoption of electric vehicles (EVs), establishing charging infrastructure, and developing a robust EV manufacturing ecosystem in India. The PM E-DRIVE scheme will also absorb the ongoing Electric Mobility Promotion Scheme (EMPS) 2024, thereby subsuming vehicles and expenditures under the EMPS within the new scheme.

Under the PM E-DRIVE, various subsidies will be offered for electric two- and three-wheelers, e-ambulances, e-trucks, and other emerging categories of EVs. The initiative will also provide grants for capital assets such as e-buses, charging station networks, and upgrades for testing agencies. However, the Central Government's efforts will require additional support from State Governments, which are encouraged to provide both fiscal and non-fiscal incentives. These include exemptions from permits, concessional road tax, toll tax, parking fees, and registration charges.

Of the total budget of US$ 963.4 million (Rs. 8,070 crore) allocated for EVs, the distribution is as follows: US$ 524.2 million (Rs. 4,391 crore) will be allocated for e-buses, and US$ 211.5 million (Rs. 1,772 crore) will be designated for electric two-wheelers. To localize EV components, a Phased Manufacturing Programme (PMP) has been introduced. Notably, EV chargers will need to incorporate at least 50% domestic value addition (DVA) from December 1, 2024, to qualify for various subsidies.

Financial support for electric two-wheelers will be reduced to US$ 59.69 (Rs. 5,000) per vehicle starting from the 2025-26 fiscal year, while the subsidy for electric three-wheelers will be capped at US$ 298.44 (Rs. 25,000) per vehicle. Like the previous FAME scheme, the PM E-DRIVE aims to subsidize locally manufactured vehicles. However, stricter checks have been put in place to prevent the misuse of subsidies, a concern highlighted in past programs.

The introduction of the PM E-DRIVE scheme signifies a pivotal moment for India’s EV landscape, aiming to create a sustainable and economically viable framework for the electric vehicle ecosystem. With significant investments in infrastructure and local manufacturing, the government is keen on fostering an environment that not only encourages the adoption of electric vehicles but also positions India as a competitive player in the global EV market.

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