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Government earmarks Rs 14,000 crore subsidy for hybrid & electric cars

Government earmarks Rs 14,000 crore subsidy for hybrid & electric cars

Snapshot: A subsidy of 35 per cent on pure electric vehicles and a 25 per cent on plug-in hybrid vehicles has been proposed.

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In order to encourage the production and buying of hybrid and electric vehicles in the country, the Government is charting out a Rs 14,000 crore subsidy. The said amount of subsidy will decided on the basis of proportion of the difference between the price of a car running on fossil fuel and that of a green vehicle.

The heavy industries ministry, which has moved a proposal for clearance by the finance ministry, has suggested that the maximum subsidy of 35 per cent should be given to pure electric vehicles, while a 25 per cent benefit should be provided for plug-in vehicles that can drive for at least 15km at a go. Similarly, the purchase of mild hybrids will fetch you a 15 per cent subsidy, while a stronger version will get a 25 per cent benefit. 

At the moment, the Indian market holds only a handful of hybrid models, which includes the Mahindra Scorpio, Toyota Prius and the Toyota Camry in addition to the fully electric Mahindra e2o. If the aforementioned ministry’s proposal is accepted, the government will, for instance provides a subsidy of around Rs 1 lakh on the purchase of a hybrid Toyota Camry, which costs around Rs 33 lakh in New Delhi, while the one running on petrol is priced at Rs 28 lakh. 

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