FAME India Scheme to reduce Vehicle Pollution: Review of Phase 1 & 2 Objectives and Success; Phase 3 Plans

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Vehicle emissions have caused a noticeable increase in pollution in recent years. In order to promote the use of electric or hybrid vehicles in India and lessen the negative environmental effects of diesel and gasoline-powered vehicles, the Central Government launched the Fame India Scheme in 2015.

 

A government subsidy program, the FAME India Scheme is a component of the National Electric Mobility Mission Plan (NEMMP). The government-backed initiative FAME, which stands for Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India, aims to promote the widespread use of electric vehicles in the nation. 

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The global emphasis on the growth of electric vehicles is a significant priority for governments worldwide. Consequently, schemes and initiatives related to this sector hold great importance in IIM and MBA Group Discussion, Personal Interview and Written Ability Test. Read this MBAUniverse.com article to prepare you for MBA Group Discussion, Personal Interview and Written Ability Test.

 

Table of Contents

  1. What is FAME India Scheme?
  2. Objectives of the Fame India Scheme
  3. Features of the Fame India Scheme
    • FAME India 1
    • FAME India 2
  4. Benefits of the Fame India Scheme
  5. FAME India Scheme: Issues & Challenges
  6. FAME India Scheme: Facts and Figures for IIM Interview & GD
  7. FAME-III: Rs.26,400 Cr Investments Expected
  8. Conclusion

What Is the Fame India Scheme?
An incentive program called the Fame India Scheme aims to encourage the use of hybrid and electric cars. "Faster Adoption and Manufacturing of Electric and Hybrid Vehicles in India" is its full name. As a component of the Ministry of Heavy Industries and Public Enterprises' National Electric Mobility Mission Plan, this programme offers subsidies to electric vehicle manufacturers and infrastructure providers. 

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The Fame India Scheme operates in two phases

  • Phase I: Launched in 2015, it was in effect until March 31, 2019.
  • Phase II: Initiated in April 2019, originally scheduled to continue until March 31, 2022, but has been extended to March 31, 2024.
  • Phase III: Under discussion.

Objectives of the Fame India Scheme
The primary goals of the Fame India Scheme include:

  1. Encouraging the production of a higher number of electric vehicles by manufacturers and related providers.
  2. Reduction of vehicular emissions and air pollution levels in the country.
  3. Establishment of an electric charging infrastructure.
  4. Targeting the conversion of 30% of total transportation to electric vehicles by the year 2030.

Features of the Fame India Scheme:

 

Phase I:

  • Emphasis on four key areas: Demand Creation, Technology Platform, Pilot Project, and Charging Infrastructure.
  • Installation of 427 charging stations.
  • Allocation of ₹895 crores for Phase I operations, supporting nearly 2.8 lakh electric vehicles.

Phase II:

  • Focus on electrification of public and shared transportation.
  • Budgetary support of ₹10,000 crores.
  • Incentives for various vehicle categories, including electric two-wheelers, electric four-wheelers, hybrid four-wheelers, e-rickshaws, and e-buses.
  • Plans to establish 2700 charging stations in metros, smart cities, and hilly states, with coverage on highways.

Phase III:
This phase in under discussion. Read more below. 

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Benefits of the Fame India Scheme:
The plan has a number of benefits:

  • A notable decrease in problems related to the environment and fuel conservation.
  • Benefits from subsidies for cars in various market segments.
  • Citizens' access to environmentally friendly public transport.
  • The charging systems' utilisation of renewable energy sources.
  • Promotion of the use of electric vehicles through the installation of charging stations.

Eligibility for Fame India Scheme:
The benefits of the Fame India scheme are available for:

  1. Electric vehicle manufacturers.
  2. Electric vehicle infrastructure providers.

FAME India Scheme II  
The Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME II) is a significant initiative by the Government of India aimed at fostering the development of Electric Vehicles (EVs). This initiative aligns with global efforts to combat climate change.

 

Government Allocation and Timeline
The Government of India has earmarked a budget of Rs 10,000 crores for the second phase of FAME II. Launched in 2019, this phase is set to conclude by 2022. The scheme is a crucial component of the National Electric Mobility Mission Plan (NEMMP), with its first phase spanning from 2015 to 2019.

 

FAME India Scheme: Issues & Challenges
The FAME India scheme's implementation raises a number of concerns:

  1. Cost Barriers for Consumers: The cost of electric vehicles is still relatively high, which makes them a major barrier to adoption, especially for those with lower incomes.
  2. Lack of Charging Infrastructure: Potential buyers are deterred from purchasing electric vehicles in India due to the lack of a widely available charging infrastructure, which makes owning and using them more difficult.
  3. Range Anxiety: For many prospective owners of electric vehicles, range anxiety—the fear of running out of battery power while driving—is a major concern.
  4. Uncertain Government Support: The government supports the FAME India scheme, but it's unclear how long that support will last. Investments in the electric vehicle industry might be discouraged by this uncertainty.
  5. Technological Difficulties

FAME India Scheme: Facts and Figures for IIM Interview & GD
Some key facts and figures related to the FAME India Scheme are outlined below:

Criteria
Details
Scheme Name
Faster Adoption and Manufacturing of Electric Vehicles
Announcement
Union Budget 2015-16
Launch Date
1st April 2015
Nodal Department
Department of Heavy Industry, Ministry of Heavy Industries
Type of Scheme
Central Sector Scheme
Objective
Support the production of electric and hybrid vehicles
Phases
Two Phases – Phase 1: 1st April 2015 to 31st March 2019 Phase 2: 1st April 2019 to 31st March 2024
Phase 3 is being discussed.
Financial Outlay
Phase 1: Rs. 895 Crore Phase 2: Rs. 10,000 Crore
Current Status of EVs in India
Market Share – 2-Wheeler: 30%, 3-Wheeler: 65%, 4-Wheeler: 2.5% Top States/UTs – Uttar Pradesh, Delhi, Assam
Benefits of the Scheme
Subsidy Incentives – Electric two-wheelers: Rs. 15,000/KWh Electric buses: Rs. 20,000/KWh Other Vehicles: Rs. 10,000/KWh

FAME-III: Rs.26,400 Cr Investments Expected

As on January 2024, the third phase of FAME-III, or Faster Adoption and Manufacturing of Electric Vehicles, is being worked on by the Ministry of Heavy Industries. The ministry is proposing to allot Rs. 26,400 crore for the FAME-III subsidy alone, based on discussions with stakeholders.

 

According to people in the know, this amount would be split between electric buses at Rs. 9,600 crore, electric three-wheelers at Rs. 4,100 crore, and electric two-wheelers at roughly Rs. 8,158 crore. Assuming certain additional elements such as the establishment of an innovation fund and funding for testing, estimates indicate that the overall allocation may exceed Rs. 33,000 crore. Further discussions on the basic contours of the scheme are currently ongoing. The focus of the proposed scheme will clearly be on enhancing electric-based and environment-friendly public transportation in the country.

 

After FAME-I and FAME-II, the finance ministry had reportedly questioned the need for extending the subsidy scheme any further. However, the ministry of heavy industries has been pushing for it, arguing the need for electric and alternate fuel vehicles. The third phase proposed allocation is much higher than FAME-Iand FAME-II at Rs.895 crore and Rs.10,000 crore, respectively.

 

Conclusion

In conclusion we can say that vehicle emissions have caused a noticeable increase in pollution in recent years. In order to promote the use of electric or hybrid vehicles in India and lessen the negative environmental effects of diesel and gasoline-powered vehicles, the Central Government launched the Fame India Scheme in 2015. After the success of FLAME 1 and 2, now Govt is planning Phase 3.

 

The global emphasis on the growth of electric vehicles is a significant priority for governments worldwide. Consequently, schemes and initiatives related to this sector hold great importance in IIM and MBA Group Discussion, Personal Interview and Written Ability Test. We hope this MBAUniverse.com article has helped you to prepare for MBA Group Discussion, Personal Interview and Written Ability Test for the IIM and MBA Admission. 

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