PM E-DRIVE

Imagine a government relay race handing the baton from one runner to a second, but deliberately having the second runner cover a shorter distance for some segments of the track and a much longer one for others, based on which segments still genuinely need the extra push. PM E-DRIVE, the scheme succeeding FAME, was structured with almost exactly this differentiated approach across vehicle categories.

PM E-DRIVE, the Prime Minister's Electric Drive Revolution in Innovative Vehicle Enhancement scheme, continues the government's push to support electric vehicle adoption after FAME's sunset, but with support levels and durations that vary meaningfully by vehicle category rather than treating all electric vehicles identically.

For two-wheelers and three-wheelers specifically, direct purchase subsidy support ended on 31 March 2026, reflecting a policy judgement that this segment, already at meaningful commercial scale and price parity approaching petrol equivalents, no longer needed direct subsidy to keep growing. For electric buses and commercial vehicles, by contrast, the scheme's support runs through 2028, reflecting how much further behind commercial vehicle electrification remains, given the much higher upfront cost and more demanding duty cycles those vehicles face.

This differentiated sunset schedule is a genuinely deliberate signal about where policymakers believe the EV transition still needs government support versus where the market can now largely carry itself, two-wheelers have crossed that threshold in the government's own assessment, buses and commercial vehicles have not.

Whenever an electric two-wheeler maker's pricing or sales strategy shifts around early 2026, PM E-DRIVE's subsidy sunset for that category is very often the direct commercial reason, forcing manufacturers to demonstrate their products can compete on their own economics rather than relying on a government incentive that specific category no longer receives.