Government To Begin Electric Car Subsidy By April 2014

By Ganesh

Updated: Tuesday, December 10, 2013, 16:06 [IST]

The National Electric Mobility Mission Plan (NEMMP), the initiative under which the government would provide subsidy to electric vehicles, was announced two years ago. But the plan has not been implemented yet, having been held due to various reasons, including economic slowdown.

However, post the 4th SIAM Diesel Conference held recently in Mumbai the Ministry of Heavy Industries has come to the decision to finally implement and if all goes well the NEMMP should come into effect from April 2014.

The Ministry of Heavy Industries will consult the Finance Ministry over the matter before the final details are chalked out. But estimates put the allotment for the seven year plan at INR 12,000 crores. During the first year about INR 2,000 crores worth of incentives is estimated to be spent.

Exactly how the allotted amount would be spent to aid electric and hybrid vehicle manufacturers and people purchasing these eco friendly vehicles is yet to be determined. The goal, however, is to create a self sustaining environment by the year 2020 when the plan comes to a close.

Also Read: Rent A Mahindra Reva e2o For Rs 100

The government estimates six to seven million electric vehicles (four wheelers and two wheelers included) would ply Indian roads in the next seven years. If all the goals of the plan are met India would save fuel worth INR 40,000 crores.

Mahindra Reva, presently the only electric car manufacturer in the country, had recently made clear its intention to suspend launch of new electric vehicles until government aid was provided. The e2o has only sold 400 units since its launch in March owing to its high price tag. Once government subsidies begin not only could we see healthy e2o sales, but also launch of other models such as the electric Verito sedan and electric commercial vehicles from Mahindra.

Apart from Mahindra, other Indian manufacturers such as Tata Motors, TVS, Bajaj would also come out with electric products.