Archive · 12 Aug 2026
Govt Extends PM E-Drive E-Two-Wheeler Subsidy to FY28, Raises Allocation
India's government has a program called PM E-Drive that makes electric vehicles cheaper to buy.
It gives money back to people who buy electric two-wheelers, like scooters and motorcycles.
The program was about to end, but the government decided to keep it going for a few more years.
It added about ₹1,000 crore more money, bringing the electric two-wheeler fund to ₹2,767 crore.
Now more scooters can get the discount — 4.57 million instead of 2.4 million.
Each electric two-wheeler can get up to ₹5,000 off.
Electric two-wheelers are good because they do not burn petrol, and two-wheelers use a lot of India's petrol.
They also help keep the air cleaner, because two-wheelers cause a big share of air pollution.
With the government's promise to keep helping, companies that make electric scooters can plan to build many more of them.
The government extended PM E-Drive subsidies for electric two-wheelers to FY28, raising the allocation to ₹2,767 crore from ₹1,772 crore (an additional ~₹1,000 crore).
The number of eligible vehicles was raised to 4.57 million from over 2.4 million.
The subsidy rate remains ₹2,500 per kWh of battery capacity, capped at ₹5,000 per electric two-wheeler.
The notification sets the last claim date as 31 December 2027, while a ministry official said subsidies will continue until March 2028.
Electric two-wheeler sales rose to 1.46 million in FY26 from 252,787 in FY22, and penetration is about 7.6% with a target of 9-10%.
- Who
- The central government's heavy industries ministry, with finance ministry approval, following a push from industry body SIAM and a Rajya Sabha standing committee.
- What
- Subsidies for electric two-wheelers under the PM E-Drive scheme were extended till FY28, with the allocation raised to ₹2,767 crore from ₹1,772 crore and eligible vehicles increased to 4.57 million from over 2.4 million.
- When
- Announced via a notification late Monday (10 August 2026), days after a standing committee report dated 6 August urged expediting the extension.
- Where
- India, announced in New Delhi.
- Why
- To accelerate electric two-wheeler adoption, lift penetration from 7.6% toward 9-10%, give manufacturers policy visibility for investments, and reduce petrol dependence and air pollution from two-wheelers.
- Scheme
- PM E-Drive (PM Electric Drive Revolution in Innovative Vehicle Enhancement)
- E-two-wheeler allocation
- ₹2,767 crore till FY28, up from ₹1,772 crore
- Eligible vehicles
- 4.57 million, up from over 2.4 million
- Subsidy rate
- ₹2,500 per kWh of battery capacity, capped at ₹5,000 per two-wheeler
- Last claim date
- 31 December 2027 (ministry official cited incentives till March 2028)
- Total scheme outlay
- ₹11,900 crore, up from ₹10,900 crore
- E-2W penetration
- 7.6%, target of 9-10%
- Petrol use by two-wheelers
- Two-thirds of the 42.6 million tonnes of petrol sold in India in FY26
