Buying a new electric car in India has become more affordable than ever, thanks to attractive government subsidies and incentives aimed at promoting clean mobility. But navigating the government subsidy landscape can be confusing. This guide explains how to get maximum government subsidy on your new electric car with simple steps, ensuring you save the most while contributing to a greener future.
Understanding Government Subsidy for Electric Cars in India
The main subsidy scheme, the FAME-II program, was launched by the Ministry of Heavy Industries to accelerate the adoption of hybrid and electric vehicles. It offers financial incentives on electric vehicles to reduce upfront costs for buyers. Apart from FAME, many Indian states provide additional benefits like road tax exemptions, registration fee waivers, and special rebates.
Step 1: Choose an Eligible Electric Vehicle Model
Subsidies under FAME-II are only available for vehicles that meet specific criteria:
- Must be a battery electric vehicle (BEV) or plug-in hybrid with zero tailpipe emissions.
- Vehicle range: Minimum distance per charge as prescribed (usually above 70 km for cars).
- Price cap: Subsidies apply to vehicles priced below a certain on-road cost limit (usually ₹15 lakh).
Always verify the model you want to buy features on the official FAME-II approved models list to qualify for subsidies.
Step 2: Purchase from a Registered Dealer
Subsidies are processed only if you buy the EV from a FAME-II registered dealer or manufacturer. Purchases from unregistered sellers or private transactions do not qualify.
Ask the dealer to provide paper trails proving the vehicle’s eligibility and subsidy claim.
Step 3: Verify Battery and Vehicle Specifications
EV battery pack capacity influences the subsidy amount. FAME-II incentives provide higher subsidies for vehicles with larger battery packs but capped by price limits.
Typical subsidy slabs (approximate):
- Up to ₹1.5 lakh for vehicles below 120 Wh/kg battery energy density
- Higher for models that exceed minimum battery and performance standards
Check battery certifications and technical datasheets when comparing models.
Step 4: Submit Required Documentation Promptly
Documentation to claim subsidy includes:
- Registration certificate or sale invoice with subsidy details
- Declaration or certificate from manufacturer regarding battery and emissions
- Proof of purchase from authorized seller
- Application form where needed on dealer/government portals
Make sure all paperwork is complete and submitted within deadlines for subsidy approval.
Step 5: Check for Additional State-Level Subsidies and Benefits
States provide unique EV incentives that stack with central subsidies, substantially reducing total ownership costs. Common benefits include:
- 100% exemption on road tax or registration fees
- Cash grants for EV buyers
- Reduced electricity tariff for home charging in some states
- Priority lanes and permits for EVs
Examples:
- Delhi offers road tax waiver and subsidized EV registration
- Maharashtra provides additional subsidy under electric vehicle policy
- Kerala and Tamil Nadu have EV-friendly policies with complementary incentives
Check your state’s transport or energy department websites for latest benefits.
Step 6: Use Government EV Financing and Loan Schemes
Alongside subsidies, the government promotes discounted loan schemes for EV buyers via public sector banks and specialized NBFCs. Look for loan products that:
- Offer interest rates lower than regular car loans
- Provide up to 100% funding with flexible tenure
- Include partial collateral waiver
This reduces your upfront financial burden, maximizing subsidy value.
Step 7: Explore Benefits Beyond Purchase
Don’t forget post-purchase benefits:
- Low annual road tax in most states for EVs
- Subsidized electricity for household EV chargers where applicable
- Lower maintenance costs due to fewer moving parts
- Possible insurance premium discounts for EVs from select insurers
Plan your ownership budget factoring these recurring savings too.
Common Mistakes to Avoid When Claiming EV Subsidies
- Buying non-eligible models or from non-registered sellers
- Missing subsidy application deadlines
- Improper or missing documentation
- Ignoring state-level incentives which can add significant cost benefits
- Not checking for battery specifications and price caps
Diligence upfront saves headaches and ensures maximum benefits.
Quick Recap: How to Maximize EV Subsidies in India
| Step | Action |
| 1. Choose eligible EV model | Verify FAME-II and price cap |
| 2. Buy from registered dealer | Confirm dealer registration |
| 3. Confirm battery specs | Ensure meets energy density rules |
| 4. Submit all paper works | Registration, invoice, certs |
| 5. Check state EV incentives | Road tax, registration waiver |
| 6. Use government EV loans | Low-interest, high LTV options |
| 7. Leverage post-purchase perks | Maintenance, charging discounts |
FAQs
Does every electric car buyer get the FAME-II subsidy?
No, eligibility depends on vehicle model, battery specs, price, and purchase source.
Can I claim subsidy if I buy a used electric car?
Typically, subsidies apply only to new EV purchases.
How do I find FAME-II registered dealers near me?
Check the Ministry of Heavy Industries’ official FAME website or consult vehicle manufacturers.
Are subsidies different for electric two-wheelers and cars?
Yes, there are separate subsidy slabs for two-wheelers, three-wheelers, and cars.
Is subsidy amount deducted at purchase or reimbursed later?
Usually, subsidies are passed at the point of sale, reducing upfront cost, but it depends on the dealer.
Conclusion
Getting the maximum government subsidy on your new electric car in India involves careful model selection, buying from registered dealers, fulfilling documentation requirements, and utilizing state-specific benefits. Combined with smart financing and ongoing savings, these subsidies make owning an EV more affordable and push India closer to a sustainable transport future.
Ensure you stay updated with official announcements, consult trusted dealers, and follow this guide to unlock the best incentives available in 2025.