The government of India is likely to extend the FAME 2 scheme till July 2024 and allocate an additional Rs 500 crore bringing the total outlay to Rs 12,000 crore says a CNBC-TV18 report.
The ongoing FAME 2 scheme was originally formulated with a budget outlay of Rs 10,000 crore and was valid till March 31, 2024.
Just last month, the government increased the budgetary allocation by Rs 1,500 crore, bringing the total outlay to Rs 11,500 crore.
The subsidies are currently available on electric two-, three- and four-wheelers registered and qualified under the FAME 2 scheme.
Interestingly, there have been strong indications of the government working closely with the industry to roll out FAME 3 scheme, which would incorporate many more segments. This was also expected to iron out the discrepancies among key stakeholders on the challenges addressed by them.
In addition, retrofitment, battery swapping, e-tractors and e-bicycles were also hoping to find their place in the FAME 3 scheme.
On the other hand, the extension of the FAME 2 scheme can be seen as a welcome move, given the upcoming general elections, and the breather for the next government to finalise the rolling out of the scheme.
But, one can question the need for the allocation of additional funds, given the fact that as of March 7, 2024, only Rs 6,096 crore or about 50% of the total budgetary allocation has been spent on incentives.
