Good Morning [%first_name |Dear Reader%],

Shifting from internal-combustion engine (ICE) vehicles to an electric or hybrid vehicle is the fourth-most climate-friendly choice an individual can make, as per a recent World Resources Institute paper. Despite sustainability and the “go green” project appearing less shiny than they did a few years ago, more Indians are on this track than ever before.

EV registrations in India crossed over a million units in H1FY26, seeing a 2% uptick from the six months prior to that, according to data from the government’s Vahan portal. And penetration is slowly but steadily picking up, even though the government’s aim to make 30% of all vehicles EVs by 2030 still seems a bit hard to achieve.

Over the last decade, the Indian government has run various subsidy schemes to encourage EV adoption and manufacturing. It started with FAME in 2015, continued with FAME-II between 2019 and 2024, and now we have the PM-EDrive scheme (which subsumed a transitional scheme rolled out after the phasing out of FAME-II). 

But that’s just the Union government. India’s states have all introduced EV promotion schemes too. And none of them are exactly the same as the other, or produced the same results. Even the Union government’s schemes have had varying outcomes: 

Focus areas have steadily shifted over the years. 

For example, the introduction of PM-EDrive marked the end of subsidy support for four-wheelers. Currently, there’s a separate central-level scheme for four-wheeler manufacturing to encourage foreign EV makers to set up base in India, but that has reportedly received little interest and the government is now mulling extending the deadline, according to Mint.

In August, PM-EDrive was extended from March 2026 to March 2028, but only for categories such as buses, trucks, and ambulances. So, as of today, subsidies on two-wheelers, three-wheelers, and rickshaws are all set to end by March next year.

States, for their part, are choosing different paths to achieve the same goal. 

Take Uttar Pradesh, whose subsidy scheme from this week will only support EVs manufactured within the state. Or Rajasthan, which earlier this month removed tax exemptions for strong hybrid vehicles, effectively increasing their price and indicating a push towards pure electric vehicles. Or Kerala, which did the opposite by scrapping road-tax concessions for full EVs—indirectly pushing customers towards strong hybrids, which come cheaper.

Of course, with so many different state-level strategies at play, some states, according to Niti Aayog, are doing better than others.

Given the recent activity in the sector, and all the twists and turns in policy, this week’s edition of The Collection looks at the foundational support provided to EVs in India so far, the different approaches manufacturers are using, and what it means for you and your budget as a prospective buyer.

Subsidy schemes can be beneficial not just during the years they’re active, but even beyond that. 

With six months remaining until the end of EV subsidy support for major categories like two-wheelers and three-wheelers, this 2024 story from Seema Singh, The Ken’s editor, is a must-read to understand the medium-term benefits of such policies.

Clearly, the latest focus area for governments, as seen with the PM-EDrive scheme, is public transport. Specifically, buses.

E-buses, however, have been operating mostly through public-private partnerships, unlike ICE buses where the majority are privately owned. This is what the e-bus system looks like in practice:

And that is just one of the roadblocks that India’s e-buses face.

Meanwhile, companies like Vinfast, which just entered the Indian market, are choosing contrarian approaches to selling EVs in a market that is already crowded with options. Like going beyond tier-1 cities, selling in workshops—“rather than asking the showroom to open service centres, they are asking the service centre to start selling”—and not shying away from charging a premium. 

Then, there’s Tesla, which is hedging its bets in a very nascent luxury EV market.

In some ways, EVs are today where mobile phones were in the early 2000s. If so, can companies like JSW MG do what Reliance did?

Of course, it isn’t just pure-play EVs that automakers are betting on. The Toyota-Maruti partnership has been benefitting from its strong presence in hybrids for a while.

But choosing hybrids over EVs has its own consequences, as we wrote in this piece from last year.

What about you? Have you already bought an EV, or are you planning to buy one? How do the price tags look to you sans the subsidies? Let me know by writing to [email protected].