India extends subsidies for electric two-wheelers

The Indian Ministry of Heavy Industries (MHI) has extended the deadline for applying for subsidies for electric two-wheelers under the “PM E-DRIVE” program to March 31, 2028, subject to funding availability. Additionally, the total budget for the program has been increased to 119 billion rupees (approximately 1.1 billion euros).

According to MHI, the revised “PM E-DRIVE” program now allows subsidies for up to 4,579,120 electric two-wheelers. This represents an increase of 2.1 million units, or 85 percent, compared to the previous limit of 2,479,120 units.

Initially, MHI set the total budget for the “PM E-DRIVE” program at 109 billion rupees (approximately 989 million euros). Of the additional 10 billion rupees (about 91 million euros) announced as part of the new changes, the ministry will use 9.95 billion rupees (around 90 million euros) to support additional electric two-wheelers. This raises the funding allocated for e-two-wheelers under the program from 17.72 billion rupees (roughly 161 million euros) to 27.67 billion rupees (about 251 million euros).

The current subsidy structure has not been changed by MHI. Starting from April 1, 2025, a subsidy of 2,500 rupees (approximately 23 euros) per kWh will be provided, capped at a maximum of 5,000 rupees (approximately 45 euros) per vehicle or 15 percent of the ex-factory price — whichever is lower. As before, only electric two-wheelers with an ex-factory price of 150,000 rupees (1,361 euros) or less are eligible for this subsidy.

As for the remaining 50 million rupees (approximately 454,000 euros) of the additional 10 billion rupees (approximately 91 million euros) allocated to the program, MHI will use this amount to raise the estimate for administrative costs from 500 million rupees (approximately 4.5 million euros) to 550 million rupees (approximately 5 million euros). When MHI first disclosed details about the program in September 2024, it stated that the “administrative expenses” cost item would cover costs related to knowledge partners or technical expertise, logistical support, as well as information, education, and communication initiatives.

MHI originally launched the PM-E-DRIVE program for the period from October 1, 2024, to March 31, 2026, integrating the previous EMPS-2024 program (running from April 1 to September 30, 2024). On August 7, 2025, the ministry announced an extension of the program until March 31, 2028, but excluded electric two-wheelers as well as e-rickshaws, e-carts, and electric three-wheelers (Category L5); the original deadline would still apply to these vehicles.

In March 2026, MHI announced that it would extend the deadline for electric two-wheelers to July 31, 2026, and for E-rickshaws and E-carts to March 31, 2028. The ministry also stated that the target for electric three-wheelers (Category L5) under the program had been achieved, so this segment was closed on December 26, 2025. With the latest change, the ministry has now extended the deadline for electric two-wheelers to the program’s official end date of March 31, 2028.

pmedrive.heavyindustries.gov.in

This article by Sagar Parikh originally appeared in our international edition, electrive.com.