Mumbai, Sept 6: Union minister Nitin Gadkari on Thursday said there is no need to provide subsidy to electric vehicle makers as consumers are now choosing EVs or CNG vehicles on their own.Addressing BNEF Summit, Gadkari said initially costs of manufacturing electric vehicles were high, but as demand has increased, production costs have dropped, making further subsidies unnecessary.
“Consumers are now choosing electric and compressed natural gas (CNG) vehicles on their own and I do not think we need to provide much subsidy for electric vehicles,” the road transport and highways minister said.
The minister pointed out that GST on electric vehicle is lower than petrol and diesel vehicles.
“In my opinion, manufacturing of electric vehicles no longer needs to be subsidised by the government.
The second phase of FAME was rolled out in 2019 with an initial outlay of Rs 10,000 crore for three years. It was later extended up to March 2024 with an additional outlay of Rs 1,500 crore.
The initial target of the scheme was to support 10 lakh electric two-wheelers, 5 lakh electric three-wheelers, 55,000 passenger cars, and 7,000 electric buses.
“On FAME 3, several suggestions are coming because in FAME 1, FAME 2 whatever lacunae is there, how to separate it, for that we are working. Even the PMO…has given some suggestions, for that our inter-ministerial group is working,” Kumaraswamy has said.
Asked about the timeline for FAME 3, the minister has said, “I think within 1 month, 2 months, it will be cleared”.
On whether FAME 3 proposal will be sent to the Union Cabinet seeking approval in a month or two, the minister has said: “Several suggestions are coming even now, we have to adopt all those things, whatever is the best, positive way, we have to take those decisions.”
