The ministry overseeing the auto industry has begun consultations with industry stakeholders to develop detailed plans for the allocated INR 500 crore incentive aimed at promoting the electrification of medium and heavy trucks in India.
The eligibility criteria for electric trucks under the PM E-DRIVE (Electric Drive Revolution in Innovative Vehicle Enhancement) initiative are being finalised and will be announced soon, according to the PM E-DRIVE website. Alongside the criteria, the incentive levels for these vehicles are also expected to be notified shortly. The Ministry of Heavy Industries (MHI) has proposed an incentive of ₹10,000 per kilowatt-hour (kWh) for medium and heavy-duty electric trucks.
A note shared with truck manufacturers lists three potential subsidy levels: ₹10,000/kWh, ₹15,000/kWh, and ₹20,000/kWh. These subsidies aim to reduce the upfront cost of electric trucks by 20%–40% and lower the total cost of ownership (TCO) by 11%–29%. Under the moderate subsidy level of ₹10,000/kWh, the proposed subsidy is capped at ₹8 lakh for electric trucks in the 3.5 to 7.5-tonne category and ₹15 lakh for those up to 12 tonnes in the N2 (Medium Duty Truck) category. For N3 Rigid Truck (Heavy Duty Truck) electric vehicles, the incentive is capped at ₹20 lakh for 12–25-tonne trucks and ₹30 lakh for those above 25 tonnes. Electric N3 Tractor Trailers above 35 tonnes have a proposed incentive cap of ₹40 lakh.
Omega Seiki Mobility, a company currently operating in the electric three-wheeler market, plans to enter the medium-duty truck segment with 3.5-tonne and 7-tonne models. Its first electric small truck, a 1.0/1.5-tonne vehicle, is scheduled for launch by December this year. The company expressed interest in learning more about the subsidy process and payment timeline, noting the positive move toward incentivizing the electric truck segment.
Estimates suggest that the ₹500 crore allocated for electrification in the medium and heavy commercial vehicle (M&HCV) segment will support the adoption of 1,975 electric trucks under the ₹10,000/kWh subsidy scenario. The ₹15,000/kWh subsidy would support 1,342 electric trucks, while 1,014 trucks would receive support if the subsidy level is set at ₹20,000/kWh.
The MHI favours the ₹10,000/kWh subsidy level to incentivize a larger number of electric trucks. This approach is expected to significantly bridge the TCO gap between electric and diesel trucks across different segments, facilitating greater deployment of electric trucks within the allocated budget of ₹500 crore.
Research by the International Council on Clean Transportation (ICCT) indicates that electric trucks in India produce 17%–29% fewer greenhouse gas emissions than diesel trucks when using grid-average electricity and 78%–83% fewer emissions when powered by renewable energy. The ICCT highlights that trucks constitute only 3% of the total vehicle fleet but contribute to 44% of CO₂ emissions from India’s road transport sector. Therefore, decarbonizing transport in India necessitates prioritizing the trucking industry, with electrification being the most promising pathway.
Industry stakeholders argue that the subsidy amount, as a percentage of the vehicle’s cost, should be substantial enough to encourage fleet operators to transition to electric vehicles. The proposed ₹10,000/kWh subsidy is equal to the incentive previously available for electric two-wheelers under the FAME II scheme, which expired in March. Initially, this figure was ₹15,000/kWh, with a cap of 40% of the vehicle’s cost.
Concerns have been raised that the requirement of a compulsory scrappage certificate might deter adoption. The proposed incentive for electric trucks would be provided only upon furnishing scrapping certificates issued by the Ministry of Road Transport and Highways (MoRTH)-authorized registered vehicle scrapping facilities (RVSFs) for internal combustion engine (ICE) trucks of equal or higher gross vehicle weight (GVW). Additionally, provisions for the transferability of RVSF scrapping certificates will be available according to MoRTH norms.
