During the extension period, the PM E-Drive subsidy on electric two-wheelers has been halved from the existing Rs 10,000 to Rs 5,000
The Ministry of Heavy Industries (MHI), Government of India, has extended the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-Drive) Scheme till March 31, 2028. First notified in Sep 2024, this scheme was rolled out to provide subsidies on the purchase of electric two-wheelers as it originally came into effect from October 1, 2024. The PM E-Drive subsidy was supposed to come to an end on March 31, 2026. However, the government extended it by three month till July 2026. Now, it has been extended once again till March 31, 2028 with an additional budget of Rs 1,000 crore.
The Government, however, has reduced the incentives from Rs 5,000 per kWh in FY 2024-25 to Rs 2,500 per kWh currently on the purchase of electric two-wheelers. The PM E-Drive subsidy maximum benefits have been capped at Rs 5,000 per vehicle. The electric scooters and motorcycles with ex-showroom price of up to Rs 1.50 lakh will be eligible for the monetary incentives.
“The proposed amount of incentive per kWh is, however, subject to review as per the reduction in vehicle cost and would be notified accordingly from time to time. The incentive shall be limited to as specified above or 15% of ex-factory price of e-2W/ e-3W, whichever is lower,” read the official notification. Several leading electric scooters such as the Bajaj Chetak, Ather Rizta, Ola S1 and TVS Orbiter will be eligible for subsidies under this scheme.
Since this a fund-limited scheme, the total outlay for the PM E-Drive remains unchanged at Rs 11,900 crore, and out of which Rs 2,767 crore have been specifically allocated for electric two-wheelers. In the official notification, the Ministry of Heavy Industries stated that this scheme can support a maximum of 45,79,120 registered electric two-wheelers till March 2028 in the country.
“In case the funds for the scheme or its relevant sub-components are exhausted prior to the terminal date of the scheme i.e. 31st March 2028, then the scheme or its relevant subcomponents will be closed accordingly i.e. no further claims will be entertained. Since 31st March 2028 is the terminal date for all segments under the Scheme no payments will be made by MHI/ PMA after this date,” read the notification.
In case of electric two-wheelers, the last date for submission of any claim to MHI/PMA for any scheme component shall be December 31, 2027. The main objective of the PM E-Drive scheme is faster adoption of electric vehicles (EVs), setting up of charging infrastructure and development of EV manufacturing eco-system in the country.
