Electric Vehicle Subsidy India — PM E-DRIVE, FAME & State EV Incentives

India is pushing hard towards electric mobility. The government offers significant subsidies and incentives to make electric vehicles (EVs) affordable for common citizens. Whether you are planning to buy an electric scooter, car, or bus — or even set up an EV charging station — there are multiple central and state schemes that can reduce your costs by ₹10,000 to ₹3 lakh or more.

This guide covers the central government's FAME scheme, the new PM E-DRIVE scheme (launched October 2024), state-level incentives across Delhi, Maharashtra, Gujarat, Karnataka, and other states, eligible vehicle categories, and a step-by-step process to claim every rupee of subsidy you are entitled to.

Disclaimer: CitizenNest is an independent informational website and is not affiliated with any government department or agency. Subsidy amounts and policies change frequently — always verify on official portals before making purchase decisions.

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What is the FAME Scheme?

FAME stands for Faster Adoption and Manufacturing of Electric Vehicles. It was the central government's flagship scheme to promote electric vehicles in India, running from 2015 to 2024.

FAME Timeline

Phase	Period	Budget	Key Focus
FAME I	2015–2019	₹895 crore	Demand incentives, pilot projects
FAME II	2019–2024	₹10,000 crore	E-2W, e-3W, e-buses, charging infrastructure
PM E-DRIVE	Oct 2024 onwards	₹10,900 crore	E-2W, e-3W, e-ambulances, e-trucks, charging infra

FAME II officially ended on 31 March 2024. It was replaced by the PM E-DRIVE scheme, which is now the active central subsidy program for electric vehicles.

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PM E-DRIVE Scheme — The New Central EV Subsidy (2024–2026)

The PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme was approved by the Union Cabinet on 11 September 2024 and launched in October 2024. It replaces FAME II with a total outlay of ₹10,900 crore over two years (FY 2024–26).

Key Features of PM E-DRIVE

• Total budget: ₹10,900 crore (₹3,679 crore for demand incentives + ₹4,391 crore for e-buses + ₹2,000 crore for charging infrastructure + ₹780 crore for others)
• Focus vehicles: Electric two-wheelers (e-2W), three-wheelers (e-3W), e-ambulances, and e-trucks
• No subsidy for private e-4W (cars): The central government continues to not offer direct purchase subsidies for private electric cars
• E-bus push: ₹4,391 crore allocated for 14,028 electric buses to be deployed by state transport undertakings
• Charging infrastructure: ₹2,000 crore for 22,100 fast chargers across the country
• E-ambulances: 10,000 e-ambulances to be supported
• Aadhaar-linked: One subsidy per Aadhaar for e-2W to prevent misuse
• Validity: Two years from launch (October 2024 to September 2026)

How the Subsidy Works

The government provides a demand incentive (upfront subsidy) that reduces the ex-showroom price of the EV at the time of purchase. You do not need to apply separately — the subsidy is applied by the manufacturer/dealer, and they claim reimbursement from the government.

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Current Subsidy Amounts Under PM E-DRIVE

Electric Two-Wheelers (E-2W)

• Subsidy of ₹5,000 per kWh of battery capacity
• Maximum subsidy cap: ₹10,000 per vehicle
• Only for vehicles with ex-showroom price up to ₹5 lakh
• Target: 24.79 lakh e-2W over two years
• Budget: ₹3,679 crore (shared with e-3W)

Popular eligible models include: Ola S1, TVS iQube, Bajaj Chetak, Ather 450X, Hero Vida V1, Ampere Nexus, and others listed on the FAME/E-DRIVE portal.

Electric Three-Wheelers (E-3W)

• Subsidy varies by category:
  • E-rickshaws: ₹25,000–₹50,000 per vehicle
  • E-autos (L5 category): Up to ₹50,000
  • E-cargo three-wheelers: Up to ₹50,000
• Target: 3.16 lakh e-3W over two years

Electric Four-Wheelers (E-4W) — Private Cars

• No direct central subsidy for private electric cars under PM E-DRIVE
• However, significant benefits still apply:
  • 5% GST (vs 28%+ for petrol/diesel cars)
  • Road tax exemption in most states
  • Income tax deduction under Section 80EEB (up to ₹1.5 lakh on loan interest)
  • State subsidies available in Delhi, Maharashtra, Gujarat, and others

Electric Buses (E-Buses)

• ₹4,391 crore allocated for 14,028 e-buses
• Subsidies provided to state transport undertakings (STUs) for procurement
• Not directly available to individual consumers
• Covers 9-metre and 12-metre bus categories

E-Ambulances and E-Trucks

• 10,000 e-ambulances supported under the scheme
• E-trucks included for the first time in a central EV scheme
• Focused on decarbonising commercial and public utility transport

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State-Wise EV Subsidies and Incentives

Many states offer additional subsidies and incentives on top of central schemes. You can avail both central and state benefits simultaneously.

Delhi — Most Generous EV Policy

Delhi's EV policy (extended through 2025) offers among the highest state incentives:

• E-2W: Additional subsidy of up to ₹30,000 (₹5,000/kWh)
• E-4W (cars): Up to ₹1.5 lakh subsidy
• E-cargo: Up to ₹30,000
• Road tax waiver: 100% exemption
• Registration fee: Waived completely
• Scrapping incentive: Additional ₹5,000 for scrapping old ICE vehicle when buying EV
• Portal: Apply through the Delhi EV portal for state subsidy

Maharashtra

• E-2W: Up to ₹25,000 subsidy
• E-4W: Up to ₹2.5 lakh (early bird incentive for first 1 lakh registrations)
• E-3W: Up to ₹1 lakh
• Road tax exemption: 100% for EVs
• SGST reimbursement on EV purchase

Gujarat

• E-2W: Up to ₹20,000 subsidy
• E-4W: Up to ₹1.5 lakh
• E-3W: Up to ₹50,000
• SGST reimbursement on EVs
• Road tax and registration fee exemption

Karnataka

• Road tax and registration fee exemption (100%)
• SGST reimbursement on EVs
• Incentives for EV charging infrastructure setup
• Focus on making Bengaluru an EV hub with dedicated charging corridors

Tamil Nadu

• SGST reimbursement for EV buyers
• 100% road tax exemption
• Capital subsidy for EV manufacturing units
• Focus on attracting EV manufacturing investments

Rajasthan

• SGST reimbursement for EV buyers
• Road tax exemption for first 3 years
• Subsidy for e-2W and e-3W purchases

Other States with EV Policies

• Telangana: Road tax exemption, 100% registration fee waiver
• Kerala: Road tax exemption, EV charging infrastructure incentives
• Madhya Pradesh: Road tax exemption for first 5 years, SGST refund
• Uttar Pradesh: SGST reimbursement, registration fee exemption, factory subsidies
• Andhra Pradesh: Road tax exemption, EV manufacturing incentives
• Odisha: SGST reimbursement, road tax exemption

Tip: State policies change frequently. Always check your state's EV policy document or transport department website for the latest incentives before purchasing.

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Eligible Vehicles — Full List by Category

To qualify for central subsidy under PM E-DRIVE, the vehicle must be on the approved model list published by the Ministry of Heavy Industries. Here is a summary by category:

Electric Two-Wheelers (E-2W)

Popular eligible brands/models:

• Ola Electric: S1 Pro, S1 Air, S1 X
• TVS: iQube series
• Bajaj: Chetak series
• Ather Energy: 450X, 450S, Rizta
• Hero Electric: Vida V1, Optima
• Ampere (Greaves): Nexus, Magnus, Primus
• Okinawa: Praise Pro, i-Praise
• BGauss, Revolt, Simple Energy and others

Electric Three-Wheelers (E-3W)

• Mahindra Electric: Treo, Treo Zor (cargo)
• Piaggio: Ape E-City
• YC Electric: E-rickshaws
• Kinetic Green, Lohia Auto, Euler Motors and others

Electric Four-Wheelers (No Central Subsidy, State Subsidies Apply)

• Tata Motors: Nexon EV, Tiago EV, Punch EV, Curvv EV
• MG Motor: ZS EV, Comet EV
• Mahindra: XEV 9e, BE 6e
• Hyundai: Ioniq 5, Creta EV
• BYD: Atto 3, Seal, e6
• Citroen: eC3

Electric Buses

• Tata Motors / Tata Marcopolo
• Ashok Leyland / Switch Mobility
• Olectra Greentech
• JBM Auto
• PMI Electro Mobility

The approved list is updated periodically. Check the FAME portal or e-Amrit portal for the current list.

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Tax Benefits for EV Buyers

Beyond direct subsidies, EV buyers enjoy several tax advantages:

Benefit	Details
Lower GST	EVs attract only 5% GST vs 28% + cess for petrol/diesel vehicles
Income tax deduction	Section 80EEB — up to ₹1.5 lakh deduction on EV loan interest
Road tax exemption	Most states offer 100% road tax exemption for EVs
Registration fee waiver	Many states waive registration charges completely
Green tax exemption	EVs are exempt from the proposed green tax on older vehicles
Lower insurance	Some insurers offer 5–15% discount on EV comprehensive insurance

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Eligibility Criteria

For Vehicle Subsidy (PM E-DRIVE)

• You must be an Indian resident purchasing an EV from an authorised dealer
• The vehicle must be on the approved model list on the FAME/E-DRIVE portal
• The vehicle must meet minimum technical specifications (range, speed, battery capacity)
• One subsidy per Aadhaar for e-2W (to prevent misuse)
• Vehicle must be registered within India

For Charging Infrastructure Subsidy

• Available to individuals, companies, RWAs, and commercial establishments
• Must use Bureau of Indian Standards (BIS) approved charging equipment
• Location must be accessible and meet DISCOM requirements
• Must comply with Ministry of Power guidelines for EV charging

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Documents Required

For Vehicle Purchase Subsidy

No separate documents needed — the dealer handles the subsidy claim. However, you will need:

• Aadhaar card (mandatory, linked to subsidy)
• Valid driving licence (for the vehicle category)
• PAN card (for tax benefit claims)
• Bank account details (for state subsidy credit)
• Address proof (if different from Aadhaar)
• Old vehicle RC (if claiming scrapping incentive in Delhi)

For Charging Infrastructure Subsidy

• Business registration documents (if applicable)
• Property ownership or lease documents
• Electrical load sanction from DISCOM
• BIS certification of charging equipment
• Bank account details
• Site plan and layout

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Step-by-Step: How to Claim EV Subsidy

For Vehicle Purchase — Central Subsidy (Automatic)

Step 1: Check Eligible Models

Visit e-amrit.niti.gov.in or the FAME portal to see the list of vehicles eligible for central subsidy under PM E-DRIVE.

Step 2: Visit an Authorised Dealer

Go to the authorised dealership of your chosen EV brand. The dealer will show you the on-road price with the central subsidy already deducted.

Step 3: Verify Subsidy Deduction

Ask the dealer to show the ex-showroom price breakdown clearly indicating the PM E-DRIVE subsidy deduction. The amount should match the applicable subsidy for your vehicle's battery capacity.

Step 4: Complete Purchase and Registration

Complete the purchase. Ensure the vehicle is registered in your name with your Aadhaar-linked details. Keep all invoices and registration documents safely.

For State Subsidy (May Require Separate Application)

Step 5: Apply for State Subsidy

In states like Delhi, Maharashtra, Gujarat, you may need to apply separately:

1. Visit your state's EV policy portal or transport department website
2. Register with your vehicle details (registration number, chassis number, invoice number)
3. Upload documents — invoice, RC copy, Aadhaar, bank account details
4. Submit the application

Step 6: Track and Receive State Subsidy

• State subsidy is typically credited to your bank account within 30–90 days
• Track status on the state portal using your application/reference number

For Income Tax Benefits

Step 7: Claim Section 80EEB Deduction

When filing your income tax return, claim the Section 80EEB deduction on interest paid for the EV loan. Keep the loan certificate from your bank showing interest paid during the financial year.

For Charging Station Subsidy

1. Check FAME/PM E-DRIVE charging infrastructure guidelines on the heavy industries ministry portal
2. Apply through your local DISCOM with project proposal and documents
3. After approval, install BIS-certified charging equipment
4. Get inspection and submit installation proof to claim subsidy

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Fees

• Vehicle subsidy: No fee — deducted from price automatically
• State subsidy application: Usually free of cost
• Charging station application: Nominal processing fees may apply depending on state/DISCOM

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Processing Time

Item	Estimated Time
Central subsidy (at dealer)	Instant — reflected in purchase price
State subsidy (after application)	30–90 days
Income tax benefit (Section 80EEB)	Claimed during annual ITR filing
Charging station subsidy	2–6 months

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Tips for EV Buyers

1. Compare total cost of ownership — EVs have lower running costs (₹1–1.5/km vs ₹5–7 for petrol). Factor in fuel savings over 5–7 years and you could save ₹2–4 lakh.

2. Stack your subsidies — Combine central subsidy + state subsidy + tax benefits. In Delhi, you could save ₹40,000+ on an electric scooter and ₹3 lakh+ on an electric car.

3. Check model eligibility before buying — Not all EV models qualify for subsidies. Always verify on the approved list at the FAME/e-Amrit portal.

4. Plan for home charging — A standard 15A home socket works for most e-2W. For e-4W, a dedicated 3.3 kW or 7.4 kW home charger (₹15,000–₹50,000) is recommended.

5. Check battery warranty — A good EV should offer at least 3 years or 50,000 km battery warranty. Premium models offer 8 years / 1.6 lakh km.

6. Consider resale value — Popular brands with good service networks (Tata, Ola, TVS, Ather) hold value better than lesser-known brands.

7. Buy only from authorised dealers — Subsidy is available only through authorised channels. Grey market purchases do not qualify.

8. Register your EV for GST benefits if you are a business owner — input tax credit may apply for commercial EV purchases.

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Related Guides

• PM Surya Ghar — Solar Rooftop Subsidy
• How to Apply for Driving Licence Online
• Vehicle Registration Certificate (RC) Transfer
• Rainwater Harvesting Subsidy
• Income Tax Return — File Online
• GST Registration Online
• Startup India DPIIT Registration
• MUDRA Loan — Apply Online

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Frequently Asked Questions (FAQs)

1. Do I need to apply separately for the PM E-DRIVE subsidy?

No, the central subsidy is applied automatically at the dealership. The dealer deducts the subsidy amount from the ex-showroom price and claims reimbursement from the government. You pay the reduced price directly.

2. Can I get both central and state subsidies?

Yes, central and state subsidies can be availed simultaneously. They are independent schemes. For example, in Delhi, you can get both the PM E-DRIVE subsidy and the Delhi EV subsidy on the same vehicle.

3. Is there a central subsidy for electric cars?

No, the PM E-DRIVE scheme does not offer a direct purchase subsidy for private electric cars (e-4W). However, you benefit from 5% GST (vs 28%+ for ICE cars), road tax exemption, registration fee waiver, and income tax deduction on loan interest. States like Delhi, Maharashtra, and Gujarat offer state-level subsidies for e-cars.

4. What is the difference between FAME II and PM E-DRIVE?

FAME II ended on 31 March 2024. PM E-DRIVE is its successor, launched in October 2024 with ₹10,900 crore budget. Key differences: PM E-DRIVE has a lower per-vehicle subsidy for e-2W (₹10,000 cap vs ₹30,000 under late FAME II), but adds support for e-ambulances, e-trucks, and more charging infrastructure.

5. What if I sell my subsidised EV within a few years?

Some subsidy schemes have a lock-in period of 2–3 years. Selling before the lock-in period may require you to refund the subsidy amount. Check the specific terms in your subsidy certificate or dealer documentation.

6. Are used or second-hand EVs eligible for subsidy?

No, subsidies are only available for new EVs purchased from authorised dealers. Used EVs do not qualify for any central or state government subsidy.

7. Can a company or business buy EVs with subsidy?

The PM E-DRIVE scheme primarily targets individual buyers for e-2W. For fleet operators and businesses, separate provisions exist for e-buses, e-ambulances, and commercial e-3W. Check the scheme guidelines or consult the dealer for your specific case.

8. How do I find EV charging stations near me?

Use apps like PlugShare, Tata Power EZ Charge, EESL ChargeGrid, or the e-Amrit portal to locate public EV charging stations. Most EV manufacturer apps (Tata, Ather, Ola) also show nearby charging points.

9. Is the PM E-DRIVE subsidy available in all states?

Yes, the central PM E-DRIVE subsidy is available across all states and union territories in India. It is a national scheme. State subsidies, however, depend on whether your state has its own EV policy — not all states offer additional subsidies.

10. How much can I save in total by buying an electric scooter in Delhi?

In Delhi, the total savings on an eligible electric scooter can be significant:

• Central subsidy (PM E-DRIVE): Up to ₹10,000
• Delhi state subsidy: Up to ₹30,000
• Road tax + registration waiver: ₹2,000–₹5,000
• Scrapping incentive: ₹5,000 (if scrapping old vehicle)
• Total potential savings: Up to ₹50,000 on an electric scooter

11. Will there be a FAME III scheme?

The PM E-DRIVE scheme is effectively the successor to FAME II (sometimes informally called FAME III). It runs from October 2024 to September 2026. A new scheme or extension may be announced after its expiry based on EV adoption progress.

12. Can I install an EV charger at home and get subsidy?

The PM E-DRIVE charging infrastructure subsidy is primarily for public and semi-public charging stations, not private home chargers. However, you can install a home charger at your own cost (₹15,000–₹50,000 for a slow charger). Some states and DISCOMs offer separate incentives for residential EV charging — check with your local electricity provider.