Home >Companies >News >'Demonetisation moment': Ather CEO Tarun Mehta as govt raises subsidy on EVs

Electric two-wheeler makers termed as "a phenomenal move" by the government to increase subsidy for such vehicles by 50% under the FAME II scheme saying it would be a game-changer in the adoption of eco-friendly vehicles.

Last week, the government made a partial modification of the scheme for Faster Adoption and Manufacturing of Electric Vehicles in India Phase II (FAME India Phase II), including increasing the demand incentive for electric two-wheelers to 15,000 per KWh from the earlier uniform subsidy of 10,000 per KWh for all EVs, including plug in hybrids and strong hybrids except busses.

In the latest modification, the department of heavy industries also capped incentives for electric two-wheelers at 40% of the cost of vehicles, up from 20% earlier.

Comparing it with 'demonetisation moment' for fintech companies, Ather Energy CEO and Co-founder Tarun Mehta said that the revision in the FAME (II) policy, increasing the subsidy by 50% per KWh, is a "phenomenal move"

"Sales of electric two-wheelers have grown despite the pandemic and with this additional subsidy, we expect electric two-wheeler sales to disrupt the market, and clock 6 million-plus units by 2025," Tarun Mehta said in a statement.

Expressing similar views, Society of Manufacturers of Electric Vehicles (SMEV) Director General Sohinder Gill said, "It's an important and an admirable decision taken by the government, a move that will bring down the prices of electric two-wheelers nearer to the IC (internal combustion engine) vehicles and remove one of the biggest blockade of the high sticker price of electric two-wheelers."

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