Focus: GS III- Indian Economy (Infrastructure)
Why in News?
Price Bids of the Grand Challenge tender process under the remodeled FAME II scheme for electric buses were opened by Ministry of Heavy Industries
- FAME India is a part of the National Electric Mobility Mission (NEMM) Plan. Main thrust of FAME is to encourage electric vehicles by providing subsidies.
- NEMM intends to allow hybrid and electric vehicles to become the first choice for the purchasers so that these vehicles can replace the conventional vehicles and thus reduce liquid fuel consumption in the country from the automobile sector.
- The scheme covers Hybrid & Electric technologies like Mild Hybrid, Strong Hybrid, Plug in Hybrid & Battery Electric Vehicles.
- Monitoring Authority: Department of Heavy Industries, the Ministry of Heavy Industries and Public Enterprises.
- Under this scheme, demand incentives will be availed by buyers (end users/consumers) upfront at the point of purchase and the same shall be reimbursed by the manufacturers from Department of Heavy Industries, on a monthly basis.
- Fame India Scheme has four focus areas:
- Technology development
- Demand Creation
- Pilot Projects
- Charging Infrastructure
Revamped FAME-II scheme
- The Centre has made a partial modification of the FAME-II, including increasing the demand incentive for electric two-wheelers to Rs. 15,000 per KWh from an earlier uniform subsidy of Rs 10,000 per KWh for all EVs, including plug-in hybrids and strong hybrids except buses.
- The government has also capped incentives for electric two-wheelers at 40% of the cost of vehicles, up from 20% earlier.
- It will bring down the prices of electric two-wheelers nearer to the IC (internal combustion engine) vehicles and remove one of the biggest blocks of the high sticker price of electric two-wheelers.
- Together with the other important factors like extremely low running cost, low maintenance and zero emission, such price levels will surely spur a substantial demand for electric two-wheelers.