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Electric Scooter and Bike Subsidies
Apr 20, 2024

Unlocking the Potential of Electric Scooter and Bike Subsidies in India

If you were to take a look at the last few years, you may notice that there has been a considerable rise in the infrastructure around electric vehicles to support their adoption by more people. This includes more manufacturers in the EV space, an increase in the number of charging stations, availability of electric vehicle insurance within the insurance sector in India, and technological advancements that support varied offerings from your new electric two-wheeler or four-wheeler. In addition to this, steps have also been taken towards enabling EV evolution and adoption among the masses through financial support in the form of subsidies. For the uninitiated, subsidies are financial grants or support offered to any industry to boost its growth so as to keep the costs involved lower and encourage consumers. In this case, subsidies for electric vehicles are expected to support the EV industry and boost the adoption of electric vehicles in the country. The transition towards electric vehicles (EVs) is a crucial step in combating climate change and reducing pollution. In India, this shift is gaining momentum, particularly in the two-wheeler segment, thanks to significant government incentives and subsidies. Understanding the landscape of these incentives, particularly for electric scooters and bikes, can help potential buyers make informed decisions. This article delves into the subsidies available under the FAME scheme and other initiatives, underscoring the role of electric bike insurance as part of the broader move towards sustainable mobility.

Electric Vehicle Policy of India

The electric vehicle policy of India is a comprehensive approach designed to foster the adoption and production of electric and hybrid vehicles. It encapsulates a variety of measures including subsidies, incentives, and infrastructure development, aimed at curbing pollution and mitigating the impacts of climate change. By electrifying both public and private transportation, the policy sets a clear path for a sustainable future. One has to consider the rising adoption of electric two-wheelers which suggests that the support offered towards EVs is also complemented by enthusiasm of consumers who are looking for better options within the two-wheeler space to support their need for convenience with new advanced technology.

The FAME Scheme

Launched in 2015, the Faster Adoption and Manufacture of (Hybrid &) Electric Vehicles (FAME) scheme is a cornerstone of India's strategy to encourage the use of electric vehicles. It provides financial incentives to manufacturers, suppliers, and consumers, facilitating a growing market for EVs. Key features of the scheme include:
  1. Financial incentives and subsidies to stimulate demand
  2. Support for technology development and manufacturing
  3. Expansion of charging infrastructure
  4. Electrification of public and government fleets
  5. Research and development initiatives
  6. Pilot projects in various regions

State-Wise FAME Subsidies

The FAME scheme operates on both a national and state level, with specific incentives varying by region. The table below outlines the subsidies offered in different states:
State Subsidy (per kWh) Maximum Subsidy Road Tax Exemption
Gujarat Rs.10,000 Rs.20,000 50%
Maharashtra Rs.5,000 Rs.25,000 100%
West Bengal Rs.10,000 Rs.20,000 100%
Bihar* Rs.10,000 Rs.20,000 100%
Rajasthan Rs.2,500 Rs.10,000 NA
Meghalaya Rs.10,000 Rs.20,000 100%
Assam Rs.10,000 Rs.20,000 100%
Other States Various Various Up to 100%

Understanding the Subsidy Process

The process to avail of the FAME subsidy involves several steps, from checking eligibility to the disbursement of the subsidy. The key is ensuring that the vehicle and its manufacturer are registered under the FAME scheme. Subsidies are then applied directly to the purchase price, making electric scooters and bikes more accessible and affordable.

Benefits of the FAME Scheme

The FAME scheme offers multiple benefits to buyers:
  1. Reduced upfront cost
  2. Lower operating expenses
  3. Enhanced charging infrastructure
  4. Contribution to environmental sustainability

Importance of Insurance for Your EV

While subsidies make electric scooters and bikes more affordable, protecting your investment with electric bike insurance is crucial. Getting at least a third-party liability insurance policy for your electric two-wheeler is not only a legal requirement but it also provides financial protection against theft, damage, and liability.* You can browse for motor insurance policies online as well as offline, as per your convenience. Potential owners should look into:
  1. Coverage options specific to electric vehicles
  2. Discounts or special offers for EVs
  3. Comprehensive vs. third-party liability policies
India's Electric Vehicle Policy and the FAME scheme are instrumental in the country's shift towards electric mobility. These initiatives, coupled with the necessary motor insurance, pave the way for a sustainable and eco-friendly transportation system. Two-wheelers in India are a way of life for a large section of the population, as it allows them convenience at a lower cost, thus enabling them to take bigger leaps towards growth. By taking advantage of available subsidies and ensuring adequate insurance coverage, individuals can contribute to a greener planet while enjoying the benefits of electric scooters and bikes.   *Standard T&C Apply Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions. Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.

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