Government extends EV two-wheeler subsidies and plans financing aid for electric trucks until 2028
The government has prolonged the PM E-DRIVE incentive for electric two-wheelers through March 2028 and is negotiating loan support measures for electric trucks.
The central government has announced that the PM E-DRIVE subsidy for electric two-wheelers will remain in force until March 31, 2028, offering Rs 2,500 per kilowatt-hour with a maximum of Rs 5,000 per vehicle, limited to 15% of the ex-factory price. The scheme aims to support up to 45.8 lakh two-wheelers, with eligibility for models priced up to Rs 1.5 lakh and a total allocation of Rs 2,767 crore. In parallel, the Ministry of Heavy Industries is working with banks and vehicle makers on an interest-subvention and credit-guarantee framework for electric trucks, seeking to close a 3-4 percentage-point financing gap with diesel counterparts.
Lenders currently price electric-truck loans higher due to concerns about battery durability and resale values. Heavy trucks represent a small share of vehicles but are responsible for a large portion of pollution and diesel consumption. The broader PM E-DRIVE programme, funded with Rs 11,900 crore, also backs charging infrastructure and domestic EV manufacturing.
Why it matters
Extending subsidies and lowering financing costs aims to boost EV adoption, reducing pollution and diesel use in India.
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