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Government announces 26 thousand crores PLI scheme for Electric Vehicles

The government has approved 26 thousand crore Production Linked Incentive Scheme (PLI). The objective of this scheme is to boost the production of electric vehicles and hydrogen fuel vehicles in the country. This scheme will provide incentives to auto manufacturers for producing electric vehicles in the next five years.

The Minister of Information and Broadcasting, Anurag Thakur, in this regard, said – “We are leapfrogging (technology) to environmentally cleaner vehicles. The new PLI scheme will work hand-in-hand with the Faster Adoption and Manufacturing of Electric Vehicles in India Phase II scheme and PLI scheme for advanced cells and therefore meet all the requirements of the electric vehicle ecosystem in India.”

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This scheme will be available for the companies who have the minimum revenue of Rs.10,000 crores. These companies must also be willing to invest Rs.2000 crores in the next five years. For the companies which are producing two-wheeler vehicles, the requirement for this amount is Rs.1000 crore. This effort will boost the production of electric and hydrogen fuel vehicles in the country. It will also create more employment and improve the health of the auto industry in the country. The benefit of this scheme will be provided alongside with FAME (Faster Adoption of Electrical Vehicles) Scheme.

These schemes will provide huge subsidies for the production of electric vehicles in the country. Regarding this, the chairman of Mahindra and Mahindra company, Anand Mahindra, tweeted – “Some may think that existing OEMs like us will be disappointed that this scheme focuses on renewable energy vehicles. Frankly, we believe this is a transformational policy change & signals to the world that India intends to be a force in the future of Automobiles.” This scheme will be effective from next year, that is, FY 2023. The base year for considering the eligibility of this scheme will be FY 2020. This scheme will advantage 10 Original Equipment Manufacturers and 50 auto component makers.

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