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Science & TechFree till Sep 9

Electric Vehicles: FAME Scheme, Battery Technology, and Adoption

July 19, 2026

Introduction

Electric Vehicles (EVs) represent a paradigm shift in mobility, offering a cleaner, quieter, and more efficient alternative to internal combustion engine (ICE) vehicles. India has set ambitious targets for EV adoption — 30% of new vehicle sales by 2030 — driven by the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme, state policies, and growing environmental consciousness.

Types of Electric Vehicles

TypePowertrainRangeChargingTypical Use
BEV (Battery EV)Full battery200–600 kmPlug-in chargePassenger cars
PHEV (Plug-in Hybrid)Battery + ICE50–100 km (electric)Plug-in + fuelTransition tech
HEV (Hybrid EV)Battery + ICENo external chargeRegenerative brakingFuel efficiency
FCEV (Fuel Cell EV)Hydrogen fuel cell500–800 kmHydrogen refillHeavy vehicles

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E-RickshawLead-acid/Li-ion80–120 kmSocket chargeLast-mile
E-2WheelerLi-ion80–150 kmPortable batteryPersonal mobility
E-BusLi-ion150–250 kmFast chargingPublic transport

FAME Scheme (Faster Adoption and Manufacturing of Electric Vehicles)

FAME India I (2015–2019)

  • Budget: ₹895 crore.
  • Focus: Technology development, pilot projects, initial demand incentives.
  • Outcome: Supported ~2.8 lakh EVs (mostly e-rickshaws and 2-wheelers).

FAME India II (2019–2024, Extended)

  • Budget: ₹10,000 crore (originally), extended with additional funding.
  • Focus: Demand incentives for buses, 3-wheelers, 4-wheelers, and 2-wheelers.
  • Emphasis: Public charging infrastructure and domestic manufacturing.

Key Features of FAME II

ComponentDetails
Demand IncentivesSubsidy on upfront purchase (per kWh battery, capped at % of vehicle cost)
E-Buses7,090 e-buses sanctioned across 64 cities (₹3,545 crore)
E-3WheelersSubsidy of up to ₹50,000 per vehicle
E-2WheelersSubsidy of up to ₹15,000 per vehicle (later increased)
E-4WheelersSubsidy for commercial fleets (taxis, cabs)
Charging Infrastructure2,877 charging stations sanctioned in 68 cities
PMP (Phased Manufacturing Programme)Gradual domestic value addition requirements

FAME III (Expected)

  • Anticipated with higher outlay (~₹20,000–25,000 crore).
  • Focus on extending subsidies, strengthening charging infrastructure, and promoting heavy electric vehicles.

State-Level EV Policies

  • Leading States: Delhi, Maharashtra, Gujarat, Karnataka, Tamil Nadu, Telangana.
  • Components: Purchase subsidies, road tax exemptions, registration fee waivers, scrappage bonuses.
  • Delhi EV Policy (2020): First comprehensive state policy; 5% target for new EV registrations achieved.

Battery Technology

Current Dominance: Lithium-ion (Li-ion)

ChemistryEnergy DensityCycle LifeCostSafetyTypical Use
LFP (LiFePO₄)MediumExcellent (3,000+)LowVery safeBuses, 2W, 3W
NMC (LiNiMnCoO₂)HighGood (1,500–2,000)MediumGoodCars, premium EVs
NCA (LiNiCoAlO₂)HighGoodHighModerateTesla
LCO (LiCoO₂)Very highLowHighPoorConsumer electronics
LTO (Li₂TiO₃)LowExcellent (10,000+)HighVery safeFast-charge buses

India's Battery Ecosystem

InitiativeDescription
PLI ACC (Advanced Chemistry Cell)₹18,100 crore scheme for 50 GWh domestic battery manufacturing
Ola CELLFAB5 GWh lithium-ion cell factory in Tamil Nadu
Reliance JuHIBattery giga-factory (Jamnagar), sodium-ion and Li-ion
Tata Agratas10 GWh plant in Gujarat for e-mobility
KABILSourcing lithium blocks in Argentina, Australia, Chile
Recycling Rules (Battery Waste Management Rules 2022)Extended producer responsibility for battery recycling

Emerging Battery Technologies

TechnologyPotentialTRL
Sodium-ionAbundant, cheap, good for grid storage and 2W/3WPre-commercial
Solid-stateHigher density, no fire risk, fast chargeR&D (mass market ~2030)
Lithium-sulphur2x density of Li-ionR&D
Aluminium-airUltra-high densityNiche (reserve battery)
Hydrogen fuel cellsHeavy-duty, long-haulEarly commercial

EV Adoption in India: Status and Challenges

Current Status (2025–26)

  • E-2Wheelers: ~7% of new 2W sales (highest EV segment).
  • E-3Wheelers: ~50% of new 3W sales (rapid electrification).
  • E-Buses: ~2,500 operational; tenders for 10,000+ underway.
  • E-4Wheelers: ~3-4% of new car sales (growing).
  • Overall: ~6% EV penetration in new vehicle sales.

Key Challenges

ChallengeDescription
Range AnxietyLimited charging infrastructure, especially in inter-city corridors
Charging Infrastructure~10,000 public chargers vs need for 400,000+ by 2030
Battery Cost~30–40% of vehicle cost; domestic cell production scaling up slowly
Grid ReadinessCan the power grid handle peak EV charging load?
Import Dependency90%+ lithium-ion cells imported (China dominance)
Raw MaterialsLithium, cobalt, nickel — limited domestic reserves
Consumer AwarenessMisconceptions about battery life, safety, running costs
Disposal and RecyclingBattery waste management infrastructure nascent
Finance/InsuranceHigher insurance premiums, limited EV-specific financing products

Government Initiatives Beyond FAME

InitiativePurpose
PLI Auto (₹26,058 crore)Incentivises EV and hydrogen fuel cell vehicle production
Production Linked Incentive (PLI ACC)50 GWh battery cell manufacturing
Charging Infrastructure Guidelines (revised 2024)Standardised chargers, tariff slabs, way-leave agreements
National EV Policy (under discussion)Framework for battery swapping, retro-fitment, and scrappage
Green Number PlatesIdentification for EVs; parking and toll benefits
GST Reduction5% GST on EVs (vs 28% on ICE vehicles)
Income Tax Deduction₹1.5 lakh deduction on EV loan interest (Section 80EEB)

Global Comparison

CountryEV Share (2024)Key PolicyLeading OEM
Norway88%Zero-emission vehicle target, heavy tax breaksTesla
China38%NEV mandate, purchase subsidiesBYD, Nio
Germany25%Subsidies, EU CO₂ standardsVW ID series
USA9%IRA tax credits ($7,500)Tesla
India6%FAME, PLI, state subsidiesOla, Tata, Bajaj

Conclusion

India's EV transition is gaining momentum, driven by supportive policies, falling battery costs, and growing consumer acceptance. The 2W and 3W segments are leading while 4W and bus segments are accelerating. Critical enablers — domestic battery manufacturing (PLI ACC), charging infrastructure expansion, and raw material security — will determine if India meets its 30% EV target by 2030. The shift also aligns with India's net-zero 2070 commitment and energy security goals.

UPSC Relevance

  • GS Paper 3: Environment, energy, science and technology
  • GS Paper 2: Government policies and interventions (FAME, PLI)
  • Prelims: FAME, PLI ACC, battery types, EV penetration