Electric vehicles are cost-effective, having fewer moving parts that require maintenance, and are green because they use very little or no fossil fuels (petrol or diesel). Some EVs utilized lead-acid or nickel-metal hydride batteries, but lithium-ion batteries are now the standard for battery electric vehicles because they are longer-lasting and better at retaining energy, with a rate of very little self-discharge.
It has already been discussed how effective and worthwhile it is to buy an electric vehicle now in India. People in this country are slowly but surely switching to alternative fuel as fuel prices rise. Ownership of an EV is generally a costly affair, even though it seems to be working for most buyers. The advantages of electric power may seem to be lower running costs compared to gasoline or diesel.
However, there is a significant difference between what you pay for an EV and a regular car. As a result, the states have released the importance of EVs, so they are offering special subsidies for those who purchase one. Therefore, here we are going to look at incentives that state and center governments offer to buyers who switch to electric vehicles.
Electric scooter and car subsidy in India by the central government
Let’s quickly review the central government incentives for electric vehicles before we move on to state subsidies. As part of the FAME-II program, the union government will facilitate the adoption of hybrids and electric vehicles
- A direct incentive of Rs 15,000 per kWh of battery capacity (maximum 40 percent of the vehicle cost) on electric scooter/ bike
- A direct incentive of Rs 10,000 per kWh of battery capacity (maximum Rs 1.5 lakh) on four-wheelers or electric cars and up to Rs 13,000 per e4W (plug-in hybrid, strong hybrid) capped at 20 percent of vehicle cost.
The Ministry of Finance also offers tax breaks for first-time buyers of EVs by offering the GST rate at 5 percent on all EVs. However, these EV subsidies/ incentives are over and above the state incentives, and they apply throughout the country. They are only applicable to the first 10 lakh electric two-wheelers and 55,000 electric four-wheelers priced under Rs 1.5 lakh and 15 lakh, respectively.
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State-wise electric scooter/ bike subsidies in India
The demand for electric two-wheelers is higher than that for four-wheelers, according to most industry reports. Therefore, it is evident that states have allocated subsidies accordingly. Based on the battery capacity, which is measured in kWh, the benefits have been calculated. Below is a detailed look at state-by-state subsidies for electric scooters and bikes:
| State | Battery capacity cost | Max Subsidy | Other benefits |
| Delhi | Rs 5,000/ kWh | Rs 30,000 | No road tax, registration fees up to Rs 10,000 scrapping incentive |
| Maharashtra | Rs 5,000/ kWh | Rs 10,000 for the 1st 10 lakh buyers | No road tax, registration fees up to Rs 15,000 early-bird incentive till December 31st up to Rs 7,000 scrapping incentive Rs 12,000 incentive with buyback scheme min 5 years warranty on the battery |
| Meghalaya | Rs 10,000/ kWh | Rs 20,000 for the first 3,500 electric scooter | No road tax, registration fees |
| Gujarat | Rs 10,000/ kWh | Rs 20,000 for the first 1.1 lakh electric two-wheelers | No road tax, registration fees |
| Chandigarh | – | Rs 20,000 for the first 3,000 vehicles | No road tax, registration fees |
| Assam | Rs 10,000/ kWh | Rs 20,000 | No road tax, registration fee |
| Bihar | Rs 10,000/ kWh | Rs 20,000 | No road tax, registration fee up to Rs 14,000 subsidy on Li-ion battery |
| Goa | Rs 10,000/ kWh | Rs 30,000 per annum for 5 years | No road tax, registration fee up to Rs 10,000 scrapping incentive |
| Rajasthan | Rs 2,500/ kWh | Rs 10,000 | No road tax, registration fee SGST reimbursement |
| Odisha | – | Rs 5,000 | No road tax, registration fee |
| West Bengal | Rs 10,000/ kWh | Rs 20,000 | No road tax, registration fee |
| Uttar Pradesh | N/A | N/A | No road tax, the registration fee for the first 1 lakh electric scooters/ bikes |
| Madhya Pradesh | N/A | N/A | Registration fee waiver |
| Kerela | N/A | N/A | Registration and road tax waiver |
| Punjab | N/A | N/A | No road tax, registration fees |
| Karnataka | N/A | N/A | Registration and road tax waiver |
| Andhra Pradesh | N/A | N/A | No road tax, registration fee till 2024 |
| Tamil Nadu | N/A | N/A | Registration fee waiver until 2024 No road tax |
| Uttarakhand | N/A | N/A | No road tax, the registration fee for the first 1 lakh electric scooters/ bikes |
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In Delhi, electric vehicle subsidies are the highest. Maharashtra and Meghalaya follow. The majority of regions have also exempted road tax, with the exception of Gujarat, which charges 50 percent of road tax with the purchase price. Currently, the number of states that do not offer any subsidies is much higher and includes Karnataka, Andhra Pradesh, Madhya Pradesh, and Tamil Nadu among others.
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State-wise electric car subsidies in India
Different states are providing subsidies for more than just electric scooters. The Tata Nexon EV and Hyundai Kona Electric are both electric cars that offer special benefits to buyers. Here is a state-by-state breakdown of where you can get the best subsidy for your EV purchase.
| State | Battery capacity cost | Max Subsidy | Other benefits |
| Maharashtra | Rs 5,000/ kWh | Rs 1,50,000 for the first 10,000 buyers | No road tax, registration fees up to Rs 1,00,000 early bird incentive till December 31st up to Rs 25,000 scrapping incentive |
| Delhi | Rs 10,000/ kWh | Rs 1,50,000 for the first 1,000 buyers | No road tax, registration fee |
| Gujarat | Rs 10,000/ kWh | Rs 1,50,000 for the first 10,000 buyers | No road tax, registration fee |
| Assam | Rs 10,000/ kWh for electric cars priced above Rs 15 lakh | Rs 1,50,000 for the first 25,000 buyers | No road tax, registration fees |
| Bihar | Rs 10,000/ kWh | Rs 1,50,000 for the first 5,000 buyers | No road tax, registration fees |
| West Bengal | Rs 10,000/ kWh | Rs 1,50,000 | No road tax, registration fees |
| Meghalaya | Rs 10,000/ kWh for electric four-wheelers priced above Rs 15 lakh | Rs 60,000 for the first 2,500 buyers | No road tax, registration fees |
| Goa | Rs 10,000/ kWh | Rs 1,50,000 for the first 500 electric cars | No road tax, registration fees |
| Odisha | N/A | Rs 1,00,000 | No road tax, registration fees |
| Chandigarh | N/A | N/A | No road tax, registration fees till 2024 |
| Punjab | N/A | N/A | No road tax, registration fees |
| Uttarakhand | N/A | N/A | No road tax, registration fees for the first 1 lakh electric vehicles |
| Uttar Pradesh | N/A | N/A | No road tax, registration fees for the first 1 lakh electric vehicles |
| Madhya Pradesh | N/A | N/A | No registration fees |
| Karnataka | N/A | N/A | No road tax, registration fees |
| Rajasthan | N/A | N/A | No road tax, registration fees |
| Kerela | N/A | N/A | No road tax, registration fees |
| Telangana | N/A | N/A | No road tax, registration fees |
| Tamil Nadu | N/A | N/A | No road tax, registration fees |
| Andhra Pradesh | N/A | N/A | No road tax, registration fees |
As we can see from the above table, Maharashtra and Delhi led the way when the schemes began. It appears that early bird incentives are already being taken advantage of. Other states continue to push more people to buy EVs in the country. Except for Gujarat, all states have exempted electric cars from road tax.
