Guide: Everything you need to know about FAME III Subsidy

The FAME III subsidy details are expected to be announced by the new government in the main budget in July 2024. The interim budget has allocated Rs 2671.33 crore for FAME III, which is a 44% cut from the previous fiscal year's allocation. However, the industry anticipates that the government may increase this amount in the main budget. Additionally, there's an expectation that FAME III will support electric two, three, and four-wheelers with a proposed budget allocation of around Rs 10,000 crore.

With the newly formed union cabinet expected to continue subsidising electric vehicles through demand incentives, the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme is set for its third iteration in the upcoming Budget next month.

Eligibility criteria for FAME III subsidies

• Vehicles must be registered in accordance with the Central Motor Vehicle Rules, 1989.
• Subsidies may be available for electric two-wheelers, three-wheelers, and four-wheelers.
• A person is likely to be eligible for the subsidy on one vehicle per category.
• The scheme may provide incentives of up to Rs 10,000 per electric two-wheeler and up to Rs 50,000 per electric three-wheeler.

Background

Rumours of a FAME-III launch with a budget of INR 10,000 crore have been circulating since the beginning of the year. However, there has been speculation about whether the government would continue funding EV subsidies, especially after last year's FAME-II challenges.

Government Deliberations

A senior government official informed ET that the Ministry of Heavy Industries (MHI) has already sent the plan for the scheme to the Prime Minister’s Office (PMO) for review. The government is expected to make a final decision on the proposal closer to the union budget, considering the fiscal situation.

Scope of FAME-III

According to reports, the FAME-III scheme will support electric two-, three-, and four-wheelers. Earlier reports suggested that the new scheme would provide increased support for electric three-wheelers and public transportation, such as e-buses.

Previous FAME Scheme

The previous iteration, FAME-II, launched in 2019 with a total outlay of INR 10,000 crore, ended in March. It aimed to support 10 lakh electric two-wheelers, 5 lakh electric three-wheelers, 7,000 electric buses, and 55,000 electric four-wheeler passenger cars through subsidies.

Documents Required for FAME III Subsidy

The specific documents required for the FAME III subsidy application have not been detailed yet, as the scheme is expected to be announced in the main budget in July 2024. These application may require:

• Vehicle registration documents.
• Proof of identity and address.
• Invoice or proof of purchase.
• Any other documents as specified by the scheme guidelines.

Once the FAME III scheme is officially announced, the government will provide a list of required documents for applicants. It's advisable to keep an eye on official announcements for the most accurate information. 

How to apply for FAME III Subsidy?

The exact steps to apply for the FAME III subsidy will be detailed once the scheme is officially announced in the main budget in July 2024. However, based on previous subsidy schemes, the general process may involve:

• Checking eligibility criteria for your vehicle.
• Gathering necessary documents (e.g., vehicle registration, proof of purchase).
• Applying through an official government portal or authorised dealer.
• Awaiting approval and receiving the subsidy.

Penalties for False Claim

The penalties for false claims under the FAME III subsidy scheme have not been detailed yet, as the scheme is expected to be announced in the main budget in July 2024. Typically, government subsidy schemes have strict measures against fraudulent claims, which may include:

• Repayment of wrongly claimed subsidies.
• Additional fines or penalties.
• Legal action, including potential criminal charges.

Once the FAME III scheme is officially announced, the government will provide clear guidelines on penalties for false claims. It's advisable to follow official announcements for accurate information on this matter. If you have any more questions or need further assistance, feel free to ask.

Carbike360 says

As the union budget approaches, the final decision on the FAME-III proposal will reflect the government's commitment to promoting electric vehicle adoption while considering the current fiscal situation. The scheme's potential impact on the EV market will be closely watched by industry stakeholders and environmental advocates alike.