As India charges toward its climate and clean mobility goals, states across the country are racing to offer the most attractive electric vehicle subsidy packages. With the national FAME‑II (Faster Adoption and Manufacturing of Electric Vehicles) program setting the floor, states are layering on additional incentives—making the effective subsidy landscape complex, competitive, and state‑specific. The leading states—Maharashtra, Goa, Gujarat, Karnataka, West Bengal, and Assam—are discussed in depth in this article.
What does Electric Vehicle Subsidy Mean?
An electric vehicle subsidy is a financial incentive, generally a direct monetary discount, provided to incentivize electric vehicles from the centre and state governments to lower the cost of electric vehicles. It can also include tax waivers, scrappage bonus, charging infrastructure incentives, toll exemptions, and more. The national FAME‑II policy currently provides up to ₹15,000/kWh for two‑wheelers and ₹10,000/kWh for four‑wheelers (capped at ₹1.5 lakh) .
States complement these with additional electric vehicle subsidy support—making total effective subsidies vary widely across India.
Importance of Electric Vehicle Subsidy
Although the price of electric vehicles is still generally higher than that of internal combustion engine (ICE) vehicles, the higher price represents a barrier for many consumers and fleet operators, particularly if there is no electric vehicle subsidy. Subsidies help to accelerate uptake, reduce air pollution, support local EV production, and help facilitate increased charging infrastructure. A significant electric vehicle subsidy would also assist India in achieving its climate goals outlined in the Paris Agreement.
Overview of State EV Subsidy Policies
1. Maharashtra: The Most Aspiring 2025 Initiative
The Maharashtra EV Policy 2025, effective from April 1, 2025, to March 31, 2030, is one of the most extensive in India. There is a budget of ₹1,993 crore—over a double to the previous budget, with an ambitious target of 30% EV adoption by 2030.
Fundamentals of Electric Vehicle Incentive:
- ₹2 lakh support for commercial vehicles.
- ₹20 lakh allocated for electric buses. Exemptions from toll on the Mumbai-Pune Expressway, Mumbai
- Nagpur Samruddhi Mahamarg, and Atal Setu.
- Complete waiver of registration fees and vehicle tax.
- Charging points every 25km on highways.
- New construction must include the capacity for electric vehicles.
- Support for electric vehicle research and development and testing facilities.
Incentives for electric vehicle manufacture
This policy combines strong electric vehicle subsidy provisions with infrastructure requirements to place Maharashtra as an early adaptor of electric vehicle transition.
2. Assam: Ambitious Policy with Early Vision
Assam introduced its Electric Vehicle Policy 2021 with the goal of achieving 25% EV penetration in total registrations by 2026. Although launched earlier, the policy remains relevant in 2025 due to its long-term targets and strict implementation roadmap.
Key Electric Vehicle Subsidy Highlights:
- Support for 200,000 EVs (100,000 two-wheelers, 75,000 three-wheelers, 25,000 four-wheelers).
- Targeted ban on fossil-fuel vehicle purchases post-2025.
- 100% government fleet transition by 2030.
- EV manufacturing and component promotion.
- Battery recycling and disposal framework.
- Charging infrastructure development.
- R&D collaborations with technical institutions.
Assam’s policy integrates a solid electric vehicle subsidy with regulatory goals like banning fossil-fuel commercial fleets by 2030, setting a precedent for other northeastern states.
3. West Bengal: Infrastructure-Driven Policy
West Bengal’s Electric Vehicle Policy was launched in 2021 for a 5-year period, with the goal of registering 1 million EVs by 2026. By 2025, the policy is in full force, emphasizing infrastructure and skill development alongside direct electric vehicle subsidy support.
Key Electric Vehicle Subsidy Highlights:
- ₹36,000 subsidy for women buying electric two-wheelers
- Tax and toll exemptions for EVs
- Reimbursement of 15% cost for public charging infrastructure
- Plans for “green zones” and EV corridors with charging stations every 25 km
- 241 charging points in Kolkata metro area (WBSEDCL initiative)
- Intelligent Mobility Skill Centre to train EV drivers, mechanics, and charging personnel
- Battery Industrialization Hub and Innovation Centre
West Bengal’s electric vehicle subsidy strategy is unique in its gender-targeted benefits and integration with education, skill development, and renewable energy.
4. Bihar: Strong Focus on Equity and Affordability (2023–2028)
Launched in 2023, the Bihar EV Policy aims for 15% of all new vehicles sold in the state to be electric by 2028. Though relatively new, it has emerged as one of the most accessible electric vehicle subsidy programs for budget-conscious consumers.
Key Electric Vehicle Subsidy Highlights:
- 75% discount on motor vehicle tax for EVs.
- ₹1.25 lakh subsidy for the first 1,000 electric cars.
- Incentives for electric two-wheelers (amount not specified).
- Approval for procurement of 400 electric buses.
- Focus on building a statewide charging network.
- Goals: Reduce air pollution, promote clean startups, ensure sustainable transport.
The electric vehicle subsidy program in Bihar prioritizes early adopters and public transport fleets, contributing to social equity and regional development.
5. Uttar Pradesh: Extended Incentive Program Until 2027
Uttar Pradesh’s EV Manufacturing and Mobility Policy, launched in 2022 and extended through 2027, provides a strong blend of demand and supply-side incentives. By 2025, it is a major electric vehicle subsidy driver in northern India.
Key Electric Vehicle Subsidy Highlights:
15% subsidy on ex-factory cost:
- ₹5,000 for two-wheelers
- ₹1 lakh for four-wheelers
- ₹20 lakh for e-buses
- ₹1 lakh for e-goods carriers
100% exemption on registration and road tax (till October 2025).
Capital subsidies for battery manufacturers.
Stamp duty reimbursements for EV factories.
100% public transport electrification in 17 smart cities by 2030.
Green routes and district-level EV corridors.
Dedicated EV Subsidy Portal for streamlined applications.
₹100 crore allocated for 200,000 two-wheelers.
₹250 crore allocated for 25,000 four-wheelers.
Uttar Pradesh’s policy showcases a well-funded electric vehicle subsidy model backed by digital ease, local manufacturing, and a focus on cleaner public mobility.
Comparative Table: EV Subsidy Highlights Across States (2025)
| State | Max Subsidy | Other Benefits | Target Year |
| Maharashtra | ₹2 lakh (4Ws), ₹20 lakh (buses) | Toll & road tax exemption, charging infra, building mandates | 2030 |
| Assam | Full support for 200,000 EVs | Ban on fossil vehicles post-2025, govt fleet EVs by 2030 | 2026–2030 |
| West Bengal | ₹36,000 (2Ws for women), 15% infra rebate | Charging corridors, skill centers, green zones | 2026 |
| Bihar | ₹1.25 lakh (first 1,000 EVs) | 75% vehicle tax discount, 400 e-buses, statewide chargers | 2028 |
| Uttar Pradesh | ₹20 lakh (e-buses), ₹1 lakh (4Ws) | 100% tax exemption, smart city focus, ₹350 crore total subsidy fund | 2027 |
Challenges Across States
Despite robust electric vehicle subsidy structures, several challenges persist:
- Fund utilization delays and inconsistent disbursement.
- Awareness gaps among buyers, especially in rural areas.
- Charging infrastructure bottlenecks, especially in Bihar and Assam.
- Overreliance on central FAME-II, which is under review for its 2025–26 extension.
Opportunities & Benefits
Cost Parity: Subsidies help achieve price parity between EVs and ICE vehicles sooner.
Clean Air: Major health benefits due to reduced air pollution.
Employment: EV policies drive jobs in battery, software, and servicing sectors.
Startup Ecosystem: Local entrepreneurs benefit from manufacturing and infrastructure grants.
Urban Transformation: Integration of green routes and EV corridors changes urban planning.
Conclusion: Who Wins the 2025 EV Subsidy Showdown?
Each state offers unique strengths, but Maharashtra stands out with its massive ₹1,993 crore commitment, high incentives, and integrated approach to infrastructure and manufacturing. Uttar Pradesh and Assam are close contenders, with strategic focus on both adoption and regulation. West Bengal and Bihar bring innovation and inclusivity, tailoring electric vehicle subsidy programs to empower women, youth, and public transport sectors.
As 2025 unfolds, India’s electric vehicle subsidy ecosystem continues to evolve—driven by ambitious state-level initiatives that are not only financially rewarding but transformative for India’s clean mobility future.