Government Prolongs PM E-Vehicle Incentive Program Until 2028
Extension of PM E-DRIVE Scheme Aims to Boost Electric Vehicle Adoption
The Indian government has announced an extension of the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) scheme until March 31, 2028. This extension comes in response to the unique challenges faced by electric vehicles (EVs) and testing agencies in India.
At present, e-trucks are still in a nascent stage, requiring more time to achieve large-scale production and market readiness. The commercial production of e-trucks is expected to take longer, necessitating continued support to build economies of scale and infrastructure.
E-buses, too, face complex post-selection processes involving milestone-linked grant disbursements over an 18-month period starting after March 2026. This complexity necessitates extended timelines to complete procurement, deployment, and operational phases.
Testing agencies also face longer timelines for tendering, evaluating, procuring, and commissioning the necessary equipment to maintain the quality and safety standards for e-trucks, e-buses, and other covered EV segments. This complexity requires additional time beyond the original 2026 deadline.
The government intends the extension to help expand EV charging infrastructure and develop India’s EV manufacturing ecosystem, which are critical for the adoption and scaling of heavier electric vehicles like buses and trucks.
However, subsidies for smaller segments such as electric two-wheelers and three-wheelers will end by March 2026. Support continues for larger vehicles and associated infrastructure due to their distinct developmental and deployment challenges.
Meanwhile, under the PM E-DRIVE initiative, MHI has rolled out an incentive scheme for 5,600 e-trucks across the country. It's worth noting that the PM E-DRIVE scheme will close if funds are exhausted before March 31, 2028.
On a state level, the Delhi government has extended its electric vehicle policy till March 31, 2026, or until a revised version is notified.
In summary, the extension of the PM E-DRIVE scheme reflects the recognition of the longer gestation period for commercial viability and deployment of e-trucks and e-buses, the complexity of equipment procurement and certification processes for testing agencies, and the need to strengthen charging and manufacturing ecosystems for heavier electric vehicles across India.
The extension of the PM E-DRIVE scheme is crucial for the growth of the energy sector, as it aims to bolster the finance required for expanding EV charging infrastructure and developing the energy-intensive EV manufacturing industry in India. This extended support will also be instrumental in overcoming the intricate financing requirements for e-buses and e-trucks.
