India is making significant strides toward a sustainable and future-ready transportation system, with the government taking decisive steps to support the electric vehicle (EV) ecosystem. By offering incentives for manufacturers of electric vehicles, components, and charging/swapping infrastructure, the government aims to create a robust, long-term market that offers substantial growth potential for electric mobility.
To ensure the widespread adoption and growth of electric vehicles in India, the government has introduced several schemes aimed at enhancing manufacturing capabilities and supporting the overall EV ecosystem. Below are the key initiatives that form the backbone of India’s EV push:
Introduced on 15th September 2021, this scheme is designed to boost India’s manufacturing capabilities for advanced automotive technologies. With a substantial budgetary outlay of ₹25,938 crore, the scheme supports the production of electric vehicles and components, encouraging domestic manufacturing and positioning India as a global hub for EVs.
Launched on 1st April 2019, the second phase of the FAME India Scheme is aimed at accelerating the adoption of electric vehicles across various segments, including two-wheelers, three-wheelers, four-wheelers, e-buses, and public EV charging stations. The government has allocated ₹11,500 crore for this initiative, which plays a vital role in reducing the upfront cost of EVs and promoting infrastructure development.
In a major push to enhance India’s battery manufacturing capacity, the government approved the PLI Scheme for ACC Battery Storage on 12th May 2021, with an allocation of ₹18,100 crore. This initiative aims to establish a competitive domestic manufacturing ecosystem for 50 GWh of advanced chemistry cell (ACC) batteries, crucial for EVs. The scheme plays a critical role in reducing India’s dependence on imported batteries and boosting energy security.
Notified on 29th September 2024, this scheme is designed to provide a comprehensive boost to various categories of electric vehicles, including two-wheelers, three-wheelers, trucks, buses, ambulances, and EV public charging stations. With an allocation of ₹10,900 crore, the PM E-DRIVE scheme is a vital part of the government’s strategy to transition to a cleaner and greener transportation ecosystem.
The PM e-Bus Sewa-Payment Security Mechanism scheme, notified on 28th October 2024, focuses on the deployment of electric buses across the country. With an outlay of ₹3,433 crore, the scheme aims to support the deployment of over 38,000 electric buses. The initiative also includes a payment security mechanism to safeguard e-bus operators in case of defaults by public transport authorities, ensuring a smooth and stable transition to electric public transportation.
The SPMEPCI Scheme, notified on March 15, 2024, focuses on promoting the manufacturing of electric passenger cars in India. This scheme requires applicants to invest a minimum of ₹4,150 crore and achieve a minimum Domestic Value Addition (DVA) of 25% by the third year and 50% by the fifth year. It aims to further drive domestic manufacturing, create jobs, and enhance the availability of electric passenger cars in India.
| Name | Market Cap (₹) | 5Y CAGR (%) |
| JBM Auto Ltd | 12,071.85 | 68.48 |
| Tata Motors Ltd | 2,38,559.47 | 45.64 |
| Mahindra and Mahindra Ltd | 3,17,254.88 | 42.41 |
| Ashok Leyland Ltd | 58,718.80 | 23.88 |
| Exide Industries Ltd | 29,291 | 17.62 |
With these comprehensive initiatives, the Indian government is laying a strong foundation for the growth of the electric vehicle market. These schemes not only encourage manufacturing but also address key challenges such as infrastructure development and consumer affordability.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: Mar 12, 2025, 9:24 AM IST
Sachin Gupta
Sachin Gupta is a Content Writer with 6+ years of experience in the stock market, including global markets like the US, Canada, and Australia. At Angel One, Sachin specialises in creating financial content that simplifies complex market trends. Sachin holds a Master's in Commerce, specialising in Economics.
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