Ministry of New and Renewable Energy (MNRE) announced a 20 per cent incentive to Electric Vehicle makers on the ex-factory prices of all electric vehicles, subject to a maximum limit.
Two-wheeler makers have also been given a subsidy ceiling of Rs 4,000 for low-speed vehicles and Rs 5,000 for high-speed vehicles. A ceiling of Rs 100,000 has been placed on Electric Cars.
Manufacturers would, however, have to register with Society of Manufacturers of Electric Vehicles(SMEV) for availing of the scheme. Registration would be provided on meeting eligibility norms, which include having 30 per cent indigenous content in the vehicles sold, a sizeable operation in retail and after sales outlets and a multi-point check system for accounting the retail sale.
The total incentive package of Rs 95-crore incentive is being extended by the Government to the industry. Most of the manufacturers have announced that they will be passing on this benefit to the consumer. According to reports, this subsidy will be applicable till 2011-12, after which it will be merged with the National Electric Vehicle Policy that is currently being formulated.
It is expected that this incentive will give a major boost to the two-wheeler manufacturers sales where there are multiple players at present including Hero Electric, Avon Cycles, BSA Motors, Yo Bikes and Lohia Auto.
The only electric car maker in India is Mahindra Reva EV Ltd which has had a total sales of 3,700 units since launch in July 2001, of which 50 per cent was in the domestic market.