FAME Scheme {Faster Adoption and Manufacture of (Hybrid and) Electric Vehicles}

FAME Scheme {Faster Adoption and Manufacture of (Hybrid and) Electric Vehicles}

Updated on May 17, 2020

The FAME India Scheme stands for Faster Adoption and Manufacture of (Hybrid and) Electric Vehicles, and this is an incentive scheme which helps to do the promotion of electric as well as hybrid vehicles in the country. The main motive of the scheme is to promote electric mobility as well as the scheme can provide financial incentives for enhancing electric vehicle production as well as the creation of electrical transportation infrastructure. The incentives provided under this scheme are in the form of subsidies that helps to manufacture the electric vehicles as well as infrastructure providers of electric cars. FAME scheme was launched in the year 2015 by the Ministry of Heavy Industries and Public Enterprises to incentivize the production as well as the promotion of eco-friendly vehicles that include electric automobiles and hybrid vehicles.

Phases of the FAME 

This scheme operates in two phases.

Phase I: This phase of the FAME scheme was started in 2015 as well as this phase was completed on March 31, 2019.

Phase II: The second phase of the scheme started on April 1, 2019, and it will be completed by March 31, 2022.

Benefits under FAME scheme

There are a lot of benefits to the FAME scheme that was restructured after the launch of FAME -II. 

FAME II

  • Phase 2 of the scheme was the expanded version of the first phase. The total outlay provided to FAME India Phase II is Rs 10000 Crores for the period of three years that is April 1, 2019, to 2022.
  • The fund allocated for this scheme for the financial year 2019-20 is Rs 1,500-crore, and for the financial year, 2020-21 is Rs 5,000 crore as well as Rs 3,500 crore for 2021-22.
  • Phase 2 of the FAME scheme will cover buses that are using EV technology electric, plug-in hybrid, and strong hybrid four-wheelers; electric three-wheelers that include e-rickshaws as well as electric two-wheelers.

The government makes project Implementation and Sanctioning Committee’ (PISC) committee for the overall monitoring, sanctions as well as the implementation of the scheme and the committee headed by the industry secretary. 

  • A committee will be made to review the incentives after a fixed period.
  • To motivate the state transport units (STUs) to buy more and more electric buses, ₹20,000 per kW will be provided as an incentive. 

Incentives under FAME – II

The incentives provided under the FAME – II scheme to the various categories of vehicles are explained below. Incentives will be provided based on given ex-factory price limits. The incentives will also be provided for the original equipment manufacturers. The centre has planned to provide an incentive of ₹10,000 per kilowatt (kW) for two-, three as well as four-wheelers, depend on the size of their batteries.

Electric two-wheelers

The incentives will be provided to the 10 lakh registered electric two-wheelers and Rs 20,000 will be given to each.

E-rickshaws

 The incentives will be provided to 5 lakh e-rickshaws and Rs 50,000 to each.

Electric four wheelers

An incentive will be provided of Rs 1.5 lakh each will get 35,000 for electric four-wheelers with an ex-factory cost of up to Rs 15 lakh.

Hybrid four wheelers

The incentives will be provided for the 20,000 strong hybrid four-wheelers, and each will get Rs 13,000 with an ex-factory price of up to Rs 15 lakh.

E-buses

The support will be provided to 7,090 e-buses with an incentive of up to Rs 50 lakh each that have the ex-factory price of up to Rs 2 crore.

Electric Charging Infrastructure

  • The purpose of this scheme is to establish more and more charging infrastructure, for this, there are 700 charging stations are going to be installed in metros, other million-plus cities, smart cities as well as cities of Hilly states across the country. The least charging station in a grid of 3 km x 3 km
  • The establishment of the charging stations is going to be proposed on major highways connecting major city clusters.
  • The charging station will be established on both sides of the roads on the highways with an interval of about 25 km each.
  • The fund allocated for establishing charging stations for electric vehicles in India is Rs 1,000 crore.

Phase I of FAME

  • The 1st phase of the FAME-India Scheme was launched on April 1, 2015, and it was extended to March 31, 2019. The original period of this phase was 2 years. This scheme was implemented with an initial outlay of Rs 895 crore. Under this phase of the scheme Approximately 2, 18,625 Electric Vehicles were ‘promoted’ till the end of July 2018.
  • The parent program of the FAME scheme was launched in 2013 that is the National Electric Mobility Mission Plan (NEMMP) 2020 to achieve sales of six-seven million units of electric vehicles as well as thus to realize to save fossil fuel from 2.2 to 2.5 million tones.
  • The promotion of electric vehicles will help to substantially lower vehicular emissions as well as to reduce carbon dioxide emissions by up to 1.5% by 2020.
  • In the year 2018, a mission was launched by the Ministry of Power with broad objectives that are the new National Electric Mobility Programme. And here the focus of this scheme was to establish the electric charging infrastructure.

Features of FAME Scheme

  • FAME India scheme is part of the National Electric Mobility Mission Plan. The main motive of FAME is to encourage electric vehicles by providing subsidies.
  • Under the National Electric Mobility Mission Plan, the government has allocated Rs 14000 crore to invest in creating infrastructure as well as to promote the use of electric vehicles.
  • The target was made to sell 6-7 million electric vehicles by the year 2020 Under the National Electric Mobility Mission Plan 2020.
  • There will be subsidy benefited provided to each type of vehicle under this scheme like two-wheelers, three-wheelers, and electric hybrid cars as well as electric buses.
  • The scheme is providing the cash in the form of a subsidy to encourage the manufacturing of electric vehicles as well as infrastructure providers of electric vehicles. 
  • The main thrust of this scheme is to encourage the electric vehicle by providing subsidies.
  • The benefits of this scheme in the form of subsidy can be taken by vehicles such as two-wheelers, three-wheelers, electric and hybrid cars as well as electric buses.
  • This scheme also covers electric as well as Hybrid technologies like Mild Hybrid, Strong Hybrid, Plug-in Hybrid, and Battery Electric Vehicles.

The Focus Areas under the FAME

The main focus areas of the FAME scheme are mentioned below:

  • Technology development 
  • Demand creation 
  • Pilot projects 
  • Charging infrastructure

Implementing agency for this is the Department of Heavy Industry, Ministry of Heavy Industries and Public Enterprises.

FAME II Scheme

The second phase of the FAME scheme is the expanded version of the first phase. All the details about the second phase of this scheme are mentioned below.

Key Features of FAME II Scheme

The foremost vital features FAME II Scheme of are mentioned below:

  • The phase 2nd of the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME-India) Scheme is also launched to give a push to electric vehicles in public transport. This scheme also encourages the adoption of EVs by way of market creation as well as demand aggregation.
  • This scheme has given a push to the holistic growth of the Electric Vehicle industry that includes charging infrastructure, research as well as the development of EV technologies and push towards bigger indigenization. 
  • The total outlay allocated for the FAME 2 scheme is ₹10,000 crore for three years till 2022. The provision is also provided for establishing charging stations for electric vehicles in India.
  • Under this scheme also incentives will be provided with the same as phase 1st. the incentives will be provided for electric buses, three-wheelers as well as four-wheelers that are used for commercial purposes. 
  • The scheme also includes plug-in hybrid vehicles as well as those with a large lithium-ion battery and electric motor. The financial support will be provided according to the size of the cell.
  • The FAME 2 scheme will provide incentives to the manufacturers who invest their time and money in developing electric vehicles as well as its components, which include lithium-ion batteries and electric motors. 
  • The centre has permitted the state government to frame their Electric Vehicle policy as well as provide additional fiscal and non-fiscal incentives to manufacturers as well as buyers.
  • Electric buses will be provided incentives based on the equipped expenditure model that is adopted by STUs.

Eligibility to get the incentive for FAME II Scheme

  • The bus, whose price is up to ₹2 crores will get incentives.
  • Strong as well as plug-in hybrids under₹15 lakh will get incentives.
  • Three-wheelers under ₹5 lakh will get incentives.
  • Two-wheelers under ₹1.5 lakh will be eligible for incentives.

Significance of the FAME II Scheme

Under this scheme, the central government will invest money to establish more and more charging stations, with the active contribution of public sector units as well as private players. 

This scheme also provides one fast-charging station for 10 electric buses as well as one slow-charging unit for every electric bus. 

Charging infrastructure projects includes those needed to expand electrification for running vehicles like pantograph charging as well as flash charging.

This phase of the FAME scheme is also able to connect renewable energy sources with charging infrastructure.


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WRITTEN BY Varsha Verma

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