Interlink Capital

India is set to strengthen its EV transition as the government plans to increase subsidies for electric two-wheelers under the PM E-Drive Scheme. The move comes amid rising fuel price volatility, geopolitical tensions in West Asia, and India’s continued focus on reducing oil import dependence while promoting clean mobility.

The Heavy Industries Ministry is reportedly seeking additional funds for the scheme, which had already allocated ₹10,900 crore to support electric two-wheelers till FY26 and was later extended till July 2026 following industry demand. So far, around 2.35 million EV two-wheelers have already been subsidised out of the targeted 2.47 million vehicles.

Despite weakness in the broader automobile market, electric two-wheelers continue to gain momentum. In the first half of May, EV two-wheeler registrations increased 13.5% year-on-year, while overall two-wheeler sales declined 5.5%, showing growing consumer preference for affordable and sustainable mobility.

Industry experts also highlight a shift in buying behaviour, where EV scooters are increasingly becoming the preferred second vehicle for daily commuting, offering significantly lower running costs and convenience through overnight charging.

India’s EV story is clearly accelerating driven by policy support, changing consumer mindset, and the push towards a cleaner and energy-efficient future.