Commercial EVs in Focus as India Rolls Out New Incentive Schemes

The Ministry of Heavy Industries (MHI) has introduced a series of initiatives aimed at accelerating electric vehicle (EV) adoption across India, with particular emphasis on wider accessibility, including in non-urban areas. Recent developments indicate a shift in focus beyond passenger transport, with policy support now extending to segments such as electric trucks and ambulances.

Demand Incentives for Commercial EV Segments
The PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme was announced on September 29, 2024, with a financial outlay of ₹10,900 crore. The scheme replaces earlier programs, including the Electric Mobility Promotion Scheme (EMPS 2024), and continues the approach of demand-side incentives.
Under PM E-DRIVE, electric two-wheelers, three-wheelers, trucks, and ambulances are eligible for support. Manufacturers offer an upfront reduction in purchase price to customers, with reimbursements claimed later from MHI. The inclusion of e-trucks and e-ambulances marks a notable policy shift toward commercial and utility vehicle electrification.

The scheme follows the conclusion of FAME-II, which operated from April 2019 to March 2024 with a total budget of ₹11,500 crore. FAME-II supported demand incentives for electric two-, three-, and four-wheelers.

Public Transport Electrification Continues
Parallel efforts to electrify public transport are being implemented through the PM-eBus Sewa Scheme, launched by the Ministry of Housing and Urban Affairs (MoHUA) on August 16, 2023. The scheme is designed to support the deployment of 10,000 electric buses across qualifying cities through a public-private partnership (PPP) model.
Central financial assistance of ₹20,000 crore has been allocated to support per-kilometre operations for a ten-year period. The level of assistance varies by bus type, ranging from ₹24 per kilometre for standard 12-metre buses to ₹20 per kilometre for 7-metre mini buses.

Additional support is available for infrastructure development. This includes full central assistance for behind-the-meter charging infrastructure and varying levels of support for depot civil works, depending on the city’s location and administrative classification. As of now, 7,293 electric buses have been sanctioned to 14 states and four union territories.

Together, these schemes indicate a broadening of India’s EV policy to include heavier and utility-focused electric vehicles, while continuing to strengthen the public transport ecosystem through electrification.