Renewable energy ministry announces 20-% incentives on electric vehicles

In what could give the Indian electric vehicles industry a major boost, the ministry of new and renewable energy (MNRE) yesterday announced a 20-per cent financial incentive on the ex-factory prices of electric cars and scooters sold in the country.

With the incentive, manufacturers would be able to lower the prices of their vehicles to bring them closer to the price of petroleum-fuelled vehicles.

Under the new scheme, electric vehicle manufacturers would receive financial incentives of up to 20 per cent on the ex- factory price for each electric vehicle sold in India.

The scheme however caps the amount of the incentive at Rs4,000 for low-speed electric two-wheelers, Rs5,000 for high-speed electric two-wheelers and Rs1 lakh for an electric car.

Thus the Reva electric car manufactured in Bangalore by Mahindra Reva Electric Company, which carries a price tag of Rs3.31 to Rs4.28 lakh across models, will now become cheaper by Rs66,000 to Rs 85,000.

According to Sohinder Singh Gill, director, Society of Manufacturers of Electric Vehicles (SMEV), and chief executive officer Hero Electric, though there were moments of despair and dejection when it took longer than what the society thought, they were glad when minister for non-renewable energy Farooq Abdullah finally cleared the scheme.