Key Details
CAG Report No. 10 of 2026: Performance Audit of the Scheme for Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India examines both phases of FAME between March 2015 and March 2024, covering demand incentives, testing, charging infrastructure, research projects and inter-agency coordination.
Audit area | Principal finding | Why it matters |
|---|---|---|
Subsidy administration | The FAME portal lacked end-to-end claim processing and adequate validation controls | The Ministry could not reliably verify some vehicle-level incentive data |
Localisation | Five manufacturers received ₹467.96 crore despite violating domestic manufacturing requirements | Subsidies may support sales without producing the intended domestic supply chain |
Charging stations | Only 148 of 2,877 approved city charging stations had been commissioned by four implementing agencies | Vehicle incentives were not matched by dependable public charging access |
Highway network | All 1,576 approved highway and expressway stations were cancelled; none of 8,412 stations awarded to oil companies met the March 2024 deadline | Long-distance EV use remained constrained despite substantial approvals |
Electric buses | 5,195 of the revised target of 6,862 buses had been deployed by December 2025 | Deployment progressed, but the promised central performance-monitoring server was still absent |
Research projects | Nine of 16 approved projects were completed; eight of those nine were delayed | Technology development received support without consistently producing timely results |
Subsidy Controls Did Not Keep Pace with Disbursement
Launched in 2015, FAME provided government support for electric and hybrid vehicles through purchase incentives, electric buses, charging infrastructure, technology-development projects and consumer awareness. FAME-I operated until March 2019, followed by FAME-II from April 2019 to March 2024.
FAME lowered the purchase price of eligible electric and hybrid vehicles through incentives passed to buyers by manufacturers. This required reliable vehicle data, certification and verification of eligibility conditions.
CAG found weaknesses in the Demand Incentive Delivery Mechanism portal, including inadequate validation checks, incomplete online processing and discrepancies between portal data and Ministry records. For FAME-I, the available records did not allow CAG to obtain assurance that all reported demand incentives were admissible.
A separate pricing issue arose when three electric two-wheeler manufacturers sold onboard chargers separately to keep vehicle prices below the ₹1.5 lakh eligibility ceiling. They subsequently refunded ₹296.52 crore to buyers, while ₹29.45 crore remained outstanding as of February 2025.
Localisation Was Verified After Incentives Had Been Paid
FAME was intended to support domestic manufacturing alongside EV adoption. Yet five manufacturers received ₹467.96 crore in incentives despite breaching localisation requirements.
The violations were detected only after detailed scrutiny, factory inspections and vehicle strip-down analysis. Two manufacturers subsequently returned ₹190.90 crore including interest, while recovery proceedings against the remaining three continued.
Certification controls also showed weaknesses. Testing agencies took up to 497 days to issue eligibility reports, while FAME-I lacked annual production-conformity testing to confirm that vehicles continued using approved components.
What Is Production-Conformity Testing? It verifies that vehicles produced after certification continue to conform to the approved model, including its components and safety features.
Charging Infrastructure Was the Largest Execution Gap
Charging infrastructure substantially lagged approvals under FAME-II:
only 148 of 2,877 approved urban charging stations had been commissioned by four agencies;
all 1,576 stations approved for highways and expressways were cancelled after negligible progress; and
none of 8,412 stations awarded to three oil-marketing companies had met the commissioning deadline of 31 March 2024.
CAG’s inspection of 104 stations and chargers also found equipment that was unpowered, damaged, removed or absent, alongside deficiencies in electrical connections, software and trained personnel.
The audit recommends a single nodal agency with end-to-end accountability, geospatial planning, advance coordination over land and electricity supply, standardised agreements and real-time central monitoring.
Supporting Components Saw Limited Execution
Consumer awareness and technology development received considerably less attention. Only ₹7.52 crore of the ₹48 crore allocated for information and awareness across the two phases was used, without an accompanying policy or annual action plan.
Of 16 technology projects approved under FAME-I, nine were completed, four closed, one cancelled and two remained in progress. CAG also found ₹13.08 crore in grants to four projects without formal agreementsspecifying deliverables, responsibilities and monitoring.
Policy Relevance
Future EV support must integrate vehicles, charging and electricity supply. Subsidising vehicle purchases cannot deliver widespread mobility if chargers lack sites, connections, maintenance or viable operating models.
Domestic manufacturing incentives require continuing verification. Localisation should be checked during production, not only when a vehicle model first becomes eligible.
Digital subsidy systems need auditable vehicle-level records. Automated validation and end-to-end claim processing are essential when public payments depend on price, certification and component-origin conditions.
Approvals should not be reported as infrastructure created. EV policy dashboards must distinguish sanctioned, installed, powered, operational and regularly used charging stations.
Accountability must follow the complete delivery chain. The Ministry, oil companies, state agencies, electricity distributors and site operators need enforceable responsibilities and milestones.
Successor schemes should retain institutional lessons from FAME. New incentives should address the audit’s findings on verification, interoperability, project monitoring and consumer awareness rather than treating each programme as a fresh start.
Follow the Full Report Here: CAG Report No. 10 of 2026: Performance Audit of the FAME India Scheme