HomeGovernment PoliciesDecoding the Indian Government's EV Subsidy: What You Should Know

Decoding the Indian Government’s EV Subsidy: What You Should Know

Discussions about climate change have occupied center stage mainly due to the increasing awareness among the general public. Social media has played a significant role in molding the public view on carbon emissions. To align themselves with the consensus, governments worldwide are investing in building infrastructure to use clean energy. 

The Indian Government has also been proactive, launching a subsidy program to incentivize EV purchases. It is a direct result of the Government’s estimate that 30% of the total vehicles running in India will be electric by 2030. In today’s article, we will look more closely at the vehicles covered under this subsidy scheme, the states where you are eligible for this subsidy, and the process by which you can apply for the subsidy program. 

Details of the Subsidy Scheme and the Vehicles That Are Covered

Under the Indian Government’s FAME-II scheme (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles), subsidies are available for a range of electric vehicles (EVs). The scheme encourages EV adoption and reduces the country’s carbon emissions.

The types of vehicles covered by the subsidy scheme include:

    • Two-wheelers: Electric scooters and motorcycles are eligible for a subsidy of Rs.15,000 per kWh up to 40% of its cost. 
    • Three-wheelers: Electric three-wheelers are eligible for an incentive of Rs.10,000 per kWh.
    • Four-wheelers: Electric buses are eligible for an incentive of up to Rs. 20,000 per kWh. Private electric cars are also eligible for a subsidy of Rs.10,000 per kWh, but only if their ex-factory price is less than Rs. 15 lakhs.

Which States Are Providing the Subsidy?

Several states have come forward with their own subsidy schemes to support consumers shifting to electric vehicles. 


Delhi was probably the first Indian state to join the movement and announce a thorough EV policy. Delhi also has the highest density of EVs per square kilometer. The state’s incentive scheme says: 

  • Two-wheelers will get a subsidy of Rs 5,000 per kWh up to Rs 30,000. There is also a scrappage benefit of up to Rs 5,000. 
  • Four-wheelers will receive Rs 10,000 per kWh up to Rs 1.5 lakh. 
  • Three-wheelers, E-rickshaws, and freight carriers like trucks will benefit up to a maximum of Rs 30,000.
  • Additionally, the Delhi state government has canceled the vehicle registration fees and road tax for every electric vehicle. 


The state government of Gujarat set a new record by providing the highest per kWh subsidy for EVs. 

  • Two-wheelers will be eligible for Rs 10,000 per kWh of battery capacity up to Rs 20,000.
  • Four-wheelers can get Rs 10,000 per kWh up to Rs 1.5 lakh.
  • Three-wheelers and E-rickshaws will get a discount of Rs 50,000. 
  • Like Delhi, Gujarat has also exempted EVs’ registration and road tax charges. 


Maharashtra revised its policy on EVs recently. If you buy an ev in Maharashtra now, you can get hefty benefits. Early birds can get a direct discount of Rs 1.5 Lakh. You just need to be one of the first 10,000 owners of electric cars applying for registration by the end of 2023.

  • Two-wheelers will get Rs 10,000 per KwH. If you are among the few early buyers, then you will get an additional Rs 15,000, Rs 7,000 for scrappage, and another Rs 12,000 in bonus incentives. 
  • Four-wheelers can get a Rs 1.50 lakh total discount, excluding Rs 25,000 received for scrappage and Rs 1.5 lakh for the limited early bird incentive. 
  • Three-wheelers and E-rickshaws can get up to Rs 30,000.
  • Again, the registration charges and road tax is exempted on all-electric vehicles.


Rajasthan’s EV policy is unique because the incentive is not provided directly. The State will reimburse the SGST paid by the buyer for the purchase of an EV. 

  • Two-wheelers will get Rs 5,000 for the battery capacity, which should not exceed 2 kWh. For battery capacity that is more than 5 kWh, the Government will pay Rs. 10,000. 
  • Three-wheelers can get Rs 10,000 for a battery capacity of fewer than 3 kWh and up to Rs 20,000 for a battery capacity exceeding 5 kWh. 


In 2021, Meghalaya announced its new EV policy. In the state, the RTO paperwork for all EVs has been expedited.

  • Two-wheelers can get Rs 10,000 per kWh.
  • Electric cars will get Rs 4,000 per kWh of battery capacity.
  • No registration charges or road tax for EVs. 

Karnataka, Andhra Pradesh, Telangana

  • All three states have exempted the registration charges and road tax for EVs. 

What Are the Criteria to Fulfill?

To be eligible for the EV subsidy under the Government’s FAME-II scheme, the vehicle you buy must meet specific criteria. These are as follows:

  • Vehicle type: The vehicle in question has to be an electric two-wheeler, electric three-wheeler, electric car, and commercial vehicle, such as a taxi or bus.
  • Battery type: It needs to have a lithium-ion battery that is manufactured in India.
  • Battery capacity: It needs to be at least 2.5 kWh. For electric three-wheelers, the battery capacity needs to be at least 5 kWh. The battery capacity for electric cars must be at least 16 kWh.
  • Range: The range needs to be at least 80 km per charge for electric two-wheelers. The range needs to be at least 100 km per charge for electric three-wheelers. The range needs to be at least 140 km per charge for electric cars.
  • Speed: For electric two-wheelers, the maximum speed needs to be at least 40 km/h. The top speed for electric three-wheelers must be at least 50 km/h. For electric cars, there is no minimum speed requirement.
  • Ex-factory price: For private electric cars, the ex-factory price (before taxes) needs to be less than Rs. 15 lakhs.
  • Certification: It needs to have either an ARAI or ICAT certification. 

What Is the Process?

After buying the EV and registering it at the RTO, you need to visit the FAME-II website. You must submit an online application along with all the necessary documents there. The authorities will verify the authenticity of your documents and disburse the incentives to your bank account. The whole process can take a couple of weeks, so be patient. 


Although the cost of buying an EV is higher than that of conventional vehicles, these incentives will help cover a significant portion of the difference. Also, you will be doing your part for the environment. Now that buying an EV in India has become lucrative, it has been expected that future car buyers in India will prefer electric vehicles over fuel-powered ones. 



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