Latest news with #PMElectricDriveRevolutioninInnovativeVehicleEnhancement
The Hindu
a day ago
- Automotive
- The Hindu
Government extends PM E-DRIVE Scheme by two years till March 2028
The government has extended the validity of the ₹10,900-crore PM E-DRIVE Scheme by two years till March 2028 for certain categories of vehicles including electric buses, e-ambulances and e-trucks. According to a gazette notification on the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme, the provisions of the scheme will now be in effect till March 2028 instead of March 2026. However, the terminal date for registered e-2W (electric two-wheeler), registered e-rickshaws & e-cart and registered e-3W (L5) shall be 31st March 2026, as per the notification. "This is a fund limited Scheme. Total payout under the Scheme shall be limited to the scheme outlay of ₹10,900 crore," the notification said. It further stated that in case the funds for the Scheme or its relevant sub-components are exhausted prior to the terminal date of the Scheme i.e. 31st March 2028, then the Scheme or its relevant sub-components will be closed accordingly and no further claims will be entertained. Saurabh Agarwal, Partner & Automotive Tax Leader, EY India, said the extension of the PM E-Drive scheme till March 2028 is a timely and focused move by the government to support electric mobility in high-impact areas like electric buses, trucks, and ambulances. "These vehicles play an important role in public transport and essential services, and increasing their adoption will help improve air quality, reduce emissions and increase adoption of electric vehicles across all cities in India. Keeping the same budget of Rs 10,900 crore and using a first-come, first-serve model will promote healthy competition and push manufacturers and operators to act quickly," he added.
Time of India
a day ago
- Automotive
- Time of India
Govt extends EV subsidy scheme but not the budget; keeps industry guessing on localisation norms
In its latest amendment notified, the Ministry of Heavy Industries has extended the PM E-Drive scheme period by two years without adding a rupee to the funds available. Also, the extended two-year period will be applicable only to vehicle categories like e-buses, e-trucks and e-ambulances, leaving electric two- and three-wheelers out. For the latter categories, the subsidy regime ends as originally envisaged on March 31, 2026. The tweaks in the PM E-Drive scheme come even as a plea by the two-wheeler OEMs (ICE as well as electric), on waiving domestic value addition (DVA) norms due to the ongoing shortage of rare earth magnets, remains unaddressed. In a nutshell, purchase subsidies available to electric two-wheelers and three-wheelers will be discontinued by March 2026 and there is no resolution feasible till now on production hiccups currently due to magnet shortages. These vehicles play an important role in public transport and essential services, and increasing their adoption will help improve air quality, reduce emissions and increase adoption of electric vehicles across all cities in IndiaSaurabh Agarwal Saurabh Agarwal, Partner & Automotive Tax Leader, EY India called the extension of PM E-Drive "a timely and focused move by the government to support electric mobility in high-impact areas like electric buses, trucks, and ambulances. These vehicles play an important role in public transport and essential services, and increasing their adoption will help improve air quality, reduce emissions and increase adoption of electric vehicles across all cities in India." The amendment: In partial modification of the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-Drive) scheme, which was notified in September 2024, two amendments have been notified this afternoon: 1) Para 5 of the scheme notification of S.O. 4259(E) dated September 29, 2024 shall stand amended as under: The PM E-Drive Scheme, with an outlay of ₹10,900 crore, shall be implemented from October 1, 2024 to March 31, 2028, for faster adoption of electric vehicles (EVs), setting up of charging infrastructure and development of EV manufacturing eco-system in the country. Further, EMPS-2024 being implemented for the period from April 1, 2024 to September 30, 2024 is subsumed under this scheme. 2) Para 46 of the scheme notification of S.O. 4259(E) dated September 29, 2024 shall stand amended as under: This is a fund limited scheme. Total payout under the scheme shall be limited to the scheme outlay of ₹10,900 crore. In case the funds for the scheme or its relevant sub-components are exhausted prior to the terminal date of the scheme i.e. March 31, 2028, then the scheme or its relevant subcomponents will be closed accordingly i.e. no further claims will be entertained. However, the terminal date for registered e-2W, registered e-rickshaws & e-cart and registered e-3W (L5) shall be March 31, 2026. What the government has indicated is that this is a sunset clause, basically, since no fund extension will be providedHemal N Thakkar Budget unchanged: The amendment makes it clear that the original overall budget of ₹10,900 crore will not be enhanced. An industry veteran pointed out that the two- and three-wheeler sales are not heavily dependent on purchase subsidies any more. But the adoption in case of e-trucks and e-ambulances has been very limited. The government likely wanted to give a clarity to this segment that subsidies will continue for them in the long run, without taking on extra burden by enhancing the scheme outlay. This person said that OEMs of e-trucks and e-buses believe that the localisation levels and adoption in their respective vehicle categories will take time and the industry was a bit sceptical of making investments meanwhile. Also Read: Govt extends PM E-DRIVE scheme till 2028 "This is the reason why the timeline for the segment has been increased," this person said. Another industry veteran said that homologation, certification etc for these products - specially electric ambulances - has taken time so the government agreed to extend the scheme for two years. Hemal N Thakkar, Senior Practice Leader and Director at Crisil Intelligence pointed out that last year, e2w sales reached almost a million units. "And this year they will reach about 1.5 million units, (provided supply side issues do not plague the industry). So, the subsidy - for which about 2.5 million units were earmarked - will likely get over this year itself for e2ws since funds will be exhausted. In the e3ws L5 category, about 2.05 lakh units were earmarked of which 1.9 lakh have been subsumed so the balance will likely also be over before the year end itself. So what the government has indicated is that this is a sunset clause, basically, since no fund extension will be provided." Price parity Thakkar also said that with incoming mandatory regulations such as ABS, the price of ICE 2ws will increase. "Prices will be higher due to mandations like ABS from January 2026 and OBD Phase II which is already applicable from April 2025. So comparatively, the cost of ownership of e2ws will become more attractive". The industry believes that instead of subsidies, long-term viability of electric two- and three-wheelers will depend on a benign taxation regime. Currently, their GST rate is 5 per cent. Thakkar pointed out that the maximum subsidy available currently, ₹5000 for e2ws, "is relatively less significant at average purchase price of ₹1 lakh for an e2W." Currently ICE 2ws and 3ws are at 28 per cent GST. The real deal breaker for electric OEMs would be a hike in GST rates.
News18
a day ago
- Automotive
- News18
Govt extends PM E-DRIVE Scheme by two years till March 2028
New Delhi, Aug 8 (PTI) The government has extended the validity of the Rs 10,900-crore PM E-DRIVE Scheme by two years till March 2028 for certain categories of vehicles including electric buses, e-ambulances and e-trucks. According to a gazette notification on the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme, the provisions of the scheme will now be in effect till March 2028 instead of March 2026. However, the terminal date for registered e-2W (electric two-wheeler), registered e-rickshaws & e-cart and registered e-3W (L5) shall be 31st March 2026, as per the notification. 'This is a fund limited Scheme. Total payout under the Scheme shall be limited to the scheme outlay of Rs 10,900 crore," the notification said. It further stated that in case the funds for the Scheme or its relevant sub-components are exhausted prior to the terminal date of the Scheme i.e. 31st March 2028, then the Scheme or its relevant sub-components will be closed accordingly and no further claims will be entertained. Saurabh Agarwal, Partner & Automotive Tax Leader, EY India, said the extension of the PM E-Drive scheme till March 2028 is a timely and focused move by the government to support electric mobility in high-impact areas like electric buses, trucks, and ambulances. 'These vehicles play an important role in public transport and essential services, and increasing their adoption will help improve air quality, reduce emissions and increase adoption of electric vehicles across all cities in India. Keeping the same budget of Rs 10,900 crore and using a first-come, first-serve model will promote healthy competition and push manufacturers and operators to act quickly," he added. PTI RSN HVA view comments First Published: Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
Mint
18-07-2025
- Automotive
- Mint
India to assess easing auto localisation norms after Chinese rare earth magnet crisis
For automakers fretting about the potential loss of incentives if they import fully built motors to skirt China's magnet export curbs, relief may be at hand. The Centre has asked testing agencies to check whether strict localization norms to claim incentives can be relaxed, three people aware of the development said. The heavy industries ministry has also asked these agencies to assess the likely impact of such a move, the people said on the condition of anonymity. 'The testing agencies have been asked to assess the potential impact on manufacturers and their localization, their domestic value addition (DVA). The Automotive Research Association of India (ARAI) will do the assessment to see if relaxations are necessary," one of the three people cited above said on the condition of anonymity. ARAI is an autonomous testing and certification agency set up by the automotive industry along with the government, and affiliated with the heavy industries ministry. Vehicles must have specific amounts of domestic content to be eligible for central incentives. With the Chinese clampdown on exports of rare earth magnets used in motors, automakers have considered importing fully-built motors instead, but that would breach the localization norms and cut off incentives; to avert this, the manufacturers had approached the Centre for relief. Four testing agencies—ARAI, International Centre for Automotive Technology (ICAT), Global Automotive Research Centre (GARC), and National Automotive Test Track (NATRAX)—have been notified under the schemes to assess localization levels and other criteria for manufacturers to claim benefits. The two central subsidy schemes are the Production Linked Incentive Scheme for Automobile and Auto Components (PLI-Auto) as well as the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme to subsidize electric mobility. Under the PLI-Auto scheme, 50% of the components used in a vehicle must be made in India. Implementation issues While the extent of the relief sought is still being discussed, even a temporary relaxation—as sought by the auto industry—would have a significant impact. The PM E-DRIVE scheme is set to lapse in less than nine months, making even short-term relief a big part of the scheme. On the other hand, the PLI-Auto scheme has a very high bar for localisation, making any deviation a major change in the way the scheme operates. One expert indicated that a revision of the norm could be tough to implement. "It is not easy to relax localization norms because you don't know where to stop and when to revert. Timeline relaxation can be considered, but a full localisation norm relaxation is difficult," said an industry consultant working with auto manufacturers. Even importing fully built motors may prove to be costly, apart from increasing reliance on China. According to Harshvardhan Sharma, group head for auto tech and innovation at Nomura Research Institute Consulting & Solutions India, the disruption in rare earth magnet supply—particularly neodymium-iron-boron (NdFeB) magnets—is increasingly forcing Indian automakers to look at importing fully assembled traction motors. 'This shift is both a cost and strategic concern," said Sharma. He said fully built motors attract a basic customs duty of 10% to 15%, whereas magnet imports or motor sub-components may fall within the 2.5-5.0% duty bracket. 'The delta in duties, combined with logistics and markup by motor OEMs, can increase the landed cost of motors by 18-25%," he said. 'Beyond cost, this dynamic increases India's exposure to supply concentration risks, particularly given China's control over 85% of global rare earth refining capacity. India's reliance on fully built motors effectively transfers part of the value chain and technological control offshore." The localisation criteria under PM E-DRIVE follow the phased manufacturing programme and list the components that manufacturers are allowed to import and mandate the ones that are to be made locally. Email queries sent to the ministry of heavy industries and the testing agencies on 14 July remained unanswered. Depleted stockpiles China's clampdown on rare earth magnets has thrown the Indian auto industry into a quagmire. Indian importers of rare earth magnets had rushed to buy the commodity at a premium, ahead of the Chinese curb on exports introduced in April, helping cushion the blow to the industry, Mint reported earlier. With those stockpiles almost depleted and no prospects of fresh magnet imports, Indian automakers are considering importing fully assembled components. Rare earth magnets, such as neodymium-iron-boron (NdFeB) magnets, are used in advanced automotive applications and are essential in components such as traction motors for electric vehicles. The Society of Indian Automobile Manufacturers had written to the ministry on 27 June, asking for a temporary relaxation of localisation norms in various government schemes like the PLI-Auto scheme and PM E-DRIVE, Mint reported on 7 July. The industry had explained the issue to the government and its testing agencies and sought relaxation of localisation norms under the two schemes, a second person aware of the development said. The industry's concern is that importing such assemblies will lower the localisation in zero-emission vehicles made by Indian manufacturers and push them out of the PLI-Auto scheme, the first official said. The scheme's focus on using locally manufactured parts to make zero-emission vehicles is to counter the dependence on the Chinese manufacturing ecosystem for critical components of EVs. The government plans to dole out about ₹2,000 crore in PLI-Auto disbursals in FY26, heavy industries minister HD Kumaraswamy said in an email interview to Mint, following disbursal of ₹332 crore in FY25. Under the PM E-DRIVE scheme, which has ₹10,900 crore to be doled out by FY26, automakers receive a reimbursement from the government for every electric two- and three-wheeler, ambulance, truck, and bus they sell at a discount. Testing agencies are critical in implementing India's clean mobility schemes. Under both PM E-DRIVE and PLI-Auto, every manufacturer has to get its vehicles vetted by at least one of the four testing agencies for localisation criteria.
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Business Standard
14-07-2025
- Automotive
- Business Standard
Electric two-wheeler firms in talks with govt for localisation relief
PLI, PMP targets under strain as rare earth magnet stocks fast dry up Surajeet Das Gupta New Delhi Listen to This Article Electric two-wheeler (e2W) firms have approached the Ministry of Heavy Industries (MHI), seeking exemptions from including electric motors in the localisation calculations under the production-linked incentive (PLI) scheme for automobile and auto components — and from the phased manufacturing programme (PMP) localisation requirement for subsidy eligibility under the PM Electric Drive Revolution in Innovative Vehicle Enhancement scheme. In a meeting with the MHI, 2W companies told the government that their stock of rare earth magnets is dwindling, leaving them with no option but to import electric motors — already fitted with rare earth magnets — directly from China. Earlier, many companies
