Government FAME-II Policy and Electric Vehicle Technology Trends to Follow in 2021


After EVs gaining rapid popularity in India, the Government decided to increase the subsidy on vehicles under the FAME-II policy. The aim is to make EVs affordable and boost adoption for the masses. There are numerous electric three-wheelers on Indian roads which are integral to the adoption of EVs and can set a good example for longevity in shared mobility whether it be last-mile cargo delivery or regular passenger commute.

Energy Efficiency Service Limited (EESL) as an aggregator is present to leverage the demand of three-wheeler EVs, by providing manufacturers with many orders helping them in economies of scale with improved inventory management. The Department of Heavy Industry believes, ”Aggregation will be the key to bring the upfront cost of electric three-wheelers at a cost-effective price level and at par with ICE three-wheelers”. The move aims to provide considerable financial benefits to EV manufacturers to help reduce the cost of ownership for the end customers. Moreover, it helps in generating demand by extending support to 7000 electric buses, 3 lakh electric three-wheelers and 10 lakh electric two-wheelers across the country.

Factors that make the FAME-II Policy a Game Changer

Rising Fuel Prices

Fuel prices are really high in the country and people are looking to switch to cheaper alternatives. This is where EVs and the FAME-II policy come in. The subsidy included in the FAME-II policy will influence the decision making as EV and ICE vehicles reach price equality, motivating more vehicle aggregators shift to EVs from existing ICE fleets. Among aggregators neEV, Altigreen’s flagship three-wheeler is quickly becoming popular and fleet owners alike, owing to the incredibly low running costs at just 82 paise per km (against ₹4-5 in the case of ICE).

The Environment

Environmental pollution has been rapidly increasing with the use of fossil fuels and masses are looking for active counterparts. During Covid-19, businesses were compelled to think differently and it changed their perception completely. Businesses, aggregators and masses are looking for sustainable solutions that are more environmentally friendly than their counterparts.

Accordance to Indian Needs

Reliability, reduced wear and tear, tolerance to unprofessional driving, and (over)load management, which are implied rules for commercial vehicles in Indian markets. India has differentiated environmental and market needs and the FAME-II policy is expected to help manufacturers who will build solutions in accordance with Indian needs.

Usable Technology

With the differentiated market needs of India, EVs are to be made more cost-effective and easily accessible through widespread distribution and reachability. Range anxiety is associated with EVs which is a major factor driving people away from them. Manufacturers should focus more upon creating EVs that seamlessly operate on the existing power standards of the country and make battery replacement for EVs seamless. Charging infrastructure should be developed to exude confidence among people. The most important part, the motor inside the EV should be reliable and optimum regeneration of power along with low consumption in unfavourable Indian conditions is the crux to provide a better offering carefully positioned to meet the needs of the market.

Also Read – Electric Cars You Can Consider For Purchase in India

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