The Ministry of Heavy Industries (MHI) has announced the reinstatement of subsidies for electric three-wheelers under the PM E-Drive Scheme, following the exhaustion of the annual subsidy allocation for FY25. This move comes after a temporary halt in the disbursement of incentives due to the cap being reached for the fiscal year.
Subsidy Allocation and Funding Increase
To address this, the MHI has allocated additional funds from the overall budget of the PM E-Drive Scheme to support electric three-wheelers. The scheme, which was introduced in October 2024, aims to boost the adoption of electric vehicles (EVs), enhance charging infrastructure, and strengthen the EV manufacturing ecosystem in India.
PM E-Drive Scheme Overview
The PM E-Drive Scheme, with a financial outlay of ₹10,900 crore, is designed to promote electric vehicles, particularly targeting the three-wheeler category. It will remain active until March 2026 and aims to incentivize around 320,000 electric three-wheelers (e-3Ws), including e-rickshaws and e-carts in the L5 vehicle category. The scheme is only applicable to e-3Ws used for commercial purposes and those with advanced battery technology.
Addressing the Subsidy Cap for FY25
Earlier, the government had temporarily stopped distributing subsidies after the annual cap for subsidised e-3Ws was nearly reached for FY25. However, with the new fund allocation, the subsidies have now been reinstated, ensuring continued support for the adoption of electric three-wheelers in the country.
