Budget 2024: Nirmala Sitharaman had doubled the budget of FAME Scheme-2 in Budget 2023. It was announced to continue the concession on duty on EV batteries. FAME means Faster Adoption and Manufacturing of Hybrid and Electric Vehicles. The Finance Minister had reduced the custom duty on lithium-ion batteries from 21 percent to 13 percent. This brought a lot of relief to battery manufacturing companies.
Budget 2024: Use of electric vehicles is increasing rapidly. The government is also emphasizing on increasing the use of electric vehicles. This will reduce the demand for petrol and diesel. Very little crude oil is produced in the country. Therefore the government has to import more than 80 percent of crude oil. A lot of foreign exchange is spent on this. Also, pollution increases due to the use of petrol and diesel. In September this year, the number of registered electric vehicles (EV) in the country was a little more than 27 lakh. EV sales in the third quarter this year stood at 3,71,214 units. This is 40 percent more than the same period a year ago. Finance Minister Nirmala Sitharaman introduced EVs inUnion Budget on February 1, 2023 Many steps were taken to promote
There will be benefit from the production of EV batteries in the country
Sitharaman had doubled the budget of FAME Scheme-2. It was announced to continue the concession on duty on EV batteries. FAME means Faster Adoption and Manufacturing of Hybrid and Electric Vehicles. The Finance Minister had reduced the custom duty on lithium-ion batteries from 21 percent to 13 percent. This brought a lot of relief to battery manufacturing companies. Besides, this has strengthened the efforts to increase the production of EV batteries in the country. Earlier, the government had also announced to bring EV batteries manufacturing under the PLI scheme. Experts believe that if batteries for electric vehicles are produced in India, their cost will reduce. This will affect the prices of EV. Currently, the share of battery in the price of EV is very high.
EV sales will increase by reducing tax on EV spare parts
The government had taken major steps to promote electric vehicles in Budget 2023. But, experts believe that the issue of GST rate on EV spare parts has not been resolved yet. The GST rate on electric vehicles is 5 percent. But, EV spare parts (except batteries) currently attract 28 percent tax. Experts believe that the government needs to reduce it soon. Reducing this will reduce the maintenance charges of EV. This will increase people’s interest in buying electric vehicles.
