India: Unlocking The Path to 2030
EVs missed out when India’s Finance Minister presented the Union budget for 2024-25 on 23 July. There were hopes that the Indian government would announce the details of the much anticipated FAME-III package to support the uptake of electric vehicles. But what is FAME, and what impact has it had on EV registrations to date?
Launched in 2015, India’s Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles (FAME) scheme was a government initiative that formed part of the National Electric Mobility Mission Plan, with the aim of promoting the uptake of Electric Vehicles (EVs) across the country.
Introduced amongst rising global action to reduce emissions, the first phase of the scheme was originally planned to run for two years before being rolled on for an additional two years with a budget of 8.95 billion rupees (approx. $120 million[1]). The budget was split across key target areas in order to achieve the scheme’s aims, which included:
Technology Platform: supporting research and development in EV technologies;
Demand Incentives: financial incentives to make vehicles more affordable and encourage uptake by consumers;
Charging Infrastructure: developing the initial foundations of a charging network;
Pilot Projects: projects which help demonstrate the viability of electric vehicles in and across India[1].
Following the success of the original FAME scheme (FAME-I) which saw EV registrations increase more than tenfold in 2019 vs. 2015, a second phase of the scheme was introduced, FAME-II. The mission of FAME-II has been to further the original aims of FAME-I, however it came with more than 10 times the budget, 100 billion rupees (approx. $1.4 billion[2]). The second phase of this scheme, which was originally planned to run up until the end of March 2022, has now just ended as of 31 July 2024, following a second extension.
With Modi’s government committed to the 30 at 30 scheme, where 30% of newly registered vehicles must be electric by 2030 the question has, predictably, been asked: what about FAME-III?
While not included in the July 2024 budget, it is highly anticipated we will see the introduction of a FAME-III scheme. With only 4.3% of new vehicle registrations being electric in 2023 there is still a long way to go to achieve the ascent to 30% in 2030.
Initial plans seemed to suggest that the initial budget proposed for FAME-II would be continued into this new phase of the scheme (100 billion rupees). However, it has been suggested the new coalition government is looking to further increase the budget for the next phase of the scheme. If correct, this is a proposal that should be widely supported. If the next phase were to continue the pattern of having a four year term, taking us possibly into 2028, then to reach the 30% target by 2030 the next phase of the scheme must look to at least reach the 20% milestone by its conclusion. While the scheme so far has been very successful in terms of uptake this has been heavily concentrated amongst motorcycles and three-wheelers. The focus of the two policy packages have so far been on these segments - however, to reach the goal of electrifying 30% of all vehicles, the package must successfully support all segments of the market.
Although the financial support for EVs under the FAME schemes has been seen as one of the key successes of the policy package, problems have marred the implementation, such as low uptake of subsidies, especially to start with, as well as criticism of slow disbursement of funds. If the Indian government wants to meet its target, FAME-III will have to ensure these problems do not continue. With the likely implementation of a phase three meaning continued support, recent policy adjustments should see India implementing a 3-pronged attack on the costs associated with EVs.
If subsidies act as the first prong against high EV retail prices, a second is in regards to the manufacture of EVs and charging infrastructure. Under FAME-II the Phased Manufacturing Programme was introduced to increase the domestic manufacture of EVs and their parts, driving down the cost of these parts. Alongside manufacturing, naturally, comes jobs. While this of itself is good, it leads onto the third prong: upskilling.
At a Society of Indian Automobile Manufacturers event H. D. Kumaraswamy (Minister of Heavy Industries) confirmed that the remit of India’s Automotive Mission Plan - the scheme aimed at increasing the manufacture and export of vehicles and their parts - had been expanded to also include a state-backed program of skill building in India which would aim to develop the labour force to have skills matching the requirement of the burgeoning EV sector.
If fulfilled, this is a massively exciting prospect which could help see India evolve into an EV manufacturing hub capable of competing with China. In a country aiming to simultaneously grow its economy as well as shrink its emissions this could provide an opportunity for a ‘two birds; one stone’ approach. While time will tell if this comes true, it is certainly a development to watch. With the IMI predicting a potential shortfall of 30,000 skilled technicians in the UK to service EVs by 2035[4] there are lessons to learn from India’s approach.
[1] UDIT, “Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles (FAME)”. [Online]. Available: https://udit.beeindia.gov.in/fame/. [Accessed: 24 Jul. 2024],
[2] IEA, “Policies to promote electric vehicle deployment”, 2021. [Online]. Available: https://www.iea.org/reports/global-ev-outlook-2021/policies-to-promote-electric-vehicle-deployment. [Accessed: 24 Jul. 2024],
[3] P. Chandak, “India Sets Ambitious Goal: 30% Electric Vehicle Sales By 2030, Says Report”, 24 Mar. 2024. [Online]. Available: https://emobilityplus.com/2024/03/26/india-sets-ambitious-goal-30-electric-vehicle-sales-by-2030-says-report/. [Accessed: 24 Jul. 2024],
[4] The IMI, “Further growth in EV qualified automotive aftermarket workforce”, 20 Feb 2024. [Online]. Available: https://tide.theimi.org.uk/industry-latest/news/further-growth-ev-qualified-automotive-aftermarket-workforce. [Accessed: 24 Jul. 2024],