FAME 3 scheme to be announced soon, with focus on EV incentives and infrastructure. Learn about the government’s clean mobility plans.
The Union Minister of Heavy Industries, H.D. Kumaraswamy, recently announced that the third phase of the government’s incentive scheme to promote clean mobility, known as FAME 3, will be revealed soon. However, it will not be part of the upcoming Budget.
Key Points
- FAME II Outlay: The second edition, FAME II, had an outlay of ₹11,500 crore.
- Expected Outlay for FAME III: FAME III is anticipated to have a smaller budget but aims to maintain incentives at ₹10,000 per electric vehicle.
- Infrastructure Development: ₹2,000 crore may be allocated for electric mobility infrastructure like charging networks.
- EV Sales Target: The government aims for 30% of all vehicles sold in India to be electric by 2030.
- Skilling and Employment: The Automotive Mission Plan will now include skilling programs to meet the EV sector’s workforce needs.
What will be in FAME 3 Scheme?
The Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles (FAME) scheme is a key initiative by the Indian government to promote electric vehicles (EVs). The second phase of this scheme, FAME II, concluded in March with a total budget of ₹11,500 crore. The upcoming FAME III is expected to have a slightly reduced budget but aims to continue providing significant incentives, reportedly around ₹10,000 per electric vehicle.
An additional ₹2,000 crore is likely to be set aside specifically for the development of EV infrastructure, such as charging networks across the country. This move is seen as essential to support the increasing adoption of electric vehicles.
The government has set an ambitious target to ensure that by 2030, 30% of all vehicles sold in India are electric. This is part of a broader strategy to achieve net-zero emissions by 2070 and reduce carbon emissions by 1 million tonnes by 2030.
During an event organized by the Society of Indian Automobile Manufacturers (SIAM) focused on skilling and employment in the EV sector, Kumaraswamy emphasized the need for expanding the scope of India’s Automotive Mission Plan. Initially aimed at boosting automobile and auto component exports, the plan will now also include skilling programs. These programs are designed to align the skills of the labor force with the requirements of the EV sector.
Dr. Hanif Qureshi, an additional secretary in the Union Ministry of Heavy Industries, highlighted that while electric three-wheelers, including e-rickshaws, have seen a penetration rate of around 50%, the rate for electric cars is much lower at about 1.8%. This contrasts with higher rates in other regions, such as 11% in the US, 24% in Europe, and 36% in China.
Sudhendu Sinha from NITI Aayog stressed the importance of dispelling myths about the EV industry’s impact on the informal sector. He emphasized the need for educational and global certification programs to ensure students are well-prepared for jobs in this growing field.
Neelesh Gupta from Deloitte India, who presented a report on skilling gaps in the EV sector, mentioned that the industry requires an investment of about ₹13,500 crore in skilling and employment. He noted that the EV industry needs around 30,000 new employees each year but currently attracts only half that number.
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