The Ministry of Heavy Industries has announced a two-month extension of the Electric Mobility Promotion Scheme 2024 (EMPS 2024), a major step in expediting India’s shift to electric vehicles.
Originally scheduled to expire on July 31, 2024, the program will now continue until September 30, 2024. The government has also upped the program’s expenditure from Rs 500 crore to Rs 778 crore.
Launched on April 1, 2024, EMPS 2024 aims to encourage the use of electric vehicles (EVs) throughout India, with a primary focus on two-wheelers (e-2W) and three-wheelers (e-3W), which includes e-carts and registered e-rickshaws. The program is intended to boost the nation’s EV manufacturing industry and assist the government’s green objectives.
Revisions to the targets state that EMPS 2024 is to support 560,789 electric vehicles, of which 60,709 e-3Ws and 500,080 e-2Ws. The program prioritizes the provision of reasonably priced and ecologically sustainable public transportation choices, emphasizing commercially registered automobiles. Incentives are also available, nevertheless, for registered e-2Ws that are individually or corporately owned.
This new scheme follows the highly successful Faster Adoption and Manufacturing of Hybrid and Electric Vehicle (FAME) II program, which concluded in March 2024 after subsidizing 13.65 lakh two-wheelers over its four-year run. The sudden withdrawal of FAME II subsidies in March 2024 had caused significant disruption in the e-2wheeler market, with major players experiencing a sharp decline in sales due to price increases of around 25%.
The extension and enhancement of EMPS 2024 come as a welcome relief to the EV industry, which has been eagerly awaiting government support following the conclusion of FAME II. The move is expected to help stabilize the market and encourage continued growth in EV adoption.
To promote advanced technologies, incentives under EMPS 2024 will only be available for EVs equipped with advanced batteries. The scheme also incorporates a Phased Manufacturing Programme (PMP) to encourage domestic manufacturing and strengthen the EV supply chain, aligning with Prime Minister Narendra Modi’s vision of Aatmanirbhar Bharat (Self-Reliant India).
While the extension of EMPS 2024 is a positive step, industry analysts note that challenges remain. These include the need for more liberal financing options from banks and the task of appealing to traditional two-wheeler buyers beyond early adopters. Additionally, technological hurdles, such as the complexities of electrifying motorcycles – the preferred format for many Indian consumers – continue to impact the speed of EV adoption.
As the Indian EV market evolves, both new entrants like Ola Electric and Ather, and legacy players such as Hero MotoCorp, Bajaj Auto, and TVS Motor are ramping up their efforts in the electric two-wheeler space. With the government’s renewed support through EMPS 2024, the industry hopes to overcome recent setbacks.