By Nachiket Kondhalkar
The Central Government has invited proposals from cities with a population over 10 lakhs for the purchase of Electric Vehicles. The Center will provide grants under the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) scheme. The cities will have to adopt electric vehicles in multi-modal public transport. The proposal has been floated by the Heavy Industries Ministry and has invited state governments and municipal corporations to make the switch to electric vehicles for shared mass transport.
The urgent shift
In India, automobile exhaust is currently one of the biggest sources of pollution in cities. Through initiatives like the FAME India Scheme, the government is not only looking to lower the levels of pollution in urban areas but is also hoping to reduce traffic congestion by promoting multimodal public transport.
Electric vehicles (EVs) are still not popular in India. High price for vehicles, shorter range and a lack of infrastructure hold back the growth of EVs in India. However, the scene is set to change as the Modi government has recently announced an ambitious plan that aspires to see India using only EVs by 2030. Parameters such as the population of a city, its average pollution level, the number of vehicles registered and ranking in Swachh Bharat Abhiyan will be the key factors while selecting the cities.
State funding for EVs
According to the proposal, the government will offer a maximum fund of Rs 105 crore to each of the selected cities in the current financial year to procure mass EVs for public transport. Other than this monetary grant, the Center will fund the setting up of charging stations and supplementary infrastructure with a maximum ceiling of Rs 15 crore per city. Funding will be available only to procure electric buses, electric four-wheelers, battery-powered passenger cars and electric three-wheelers. Incentives will be provided for buyers including end-users and consumers. They will be in the form of an upfront reduced price to enable wider adoption of EVs, under the FAME India Scheme.
The impact of the scheme
Earlier this year in May, the Union Minister for Road Transport and Highways, Nitin Gadkari had sent a strong message to automakers to make the move towards alternative-fuel vehicles, saying “I am going to do it, whether you like it or not. I will bulldoze. Petrol diesel banaane walon kaa band-baajaa bajaanaa hai (We will take the makers of petrol/diesel engine vehicles to task).” Gadkari had said.
Following the government’s EV push, Maruti Suzuki Chairman, RC Bhargava had said that the company plans to release models based on customer preferences. The move could greatly enhance the usage of EVs in the country and lead to a cleaner environment over time.
States search for investors
States are playing equally important roles in adopting EVs. Recently, the Karnataka government had said that it is exploring every possibility to attract investments worth Rs 31,000 crore from companies looking to set up manufacturing and Research and Development (R&D) units for EVs in the state.
According to a report by the Society of Manufacturers of Electric Vehicles, there has been a 37.5% rise in the sale of EVs in India in recent years. In a bid to achieve 100% EV usage by 2030, the government has also announced a tax reduction of about 12 percent on EVs, along with the roll-out of Goods and Services Tax (GST).
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