UPSC Prelims Practice Questions — PM E-DRIVE Scheme

Q1. Consider the following statements: Which of the following is correct in respect of the above statements?

  1. Demand incentives under the PM E-DRIVE Scheme are expected to benefit domestic auto-component suppliers, not merely the firms that assemble electric vehicles.
  2. An OEM can claim PM E-DRIVE incentives only if it complies with the Phased Manufacturing Programme, which requires sourcing components from local manufacturers, including small and medium enterprises.
  • A. Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
  • B. Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
  • C. Statement-I is correct, but Statement-II is incorrect
  • D. Statement-I is incorrect, but Statement-II is correct

Q2. An OEM launches an electric two-wheeler priced below ₹1.5 lakh ex-factory that meets the battery-linked incentive norms of the PM E-DRIVE Scheme. However, its components are largely imported and it does not hold a Phased Manufacturing Programme (PMP) compliance certificate. In this context, consider the following statements: Which of the statements given above is/are correct?

  1. The PM E-DRIVE incentive cannot be passed on to buyers of this model, because the OEM is not eligible for reimbursement on it.
  2. A buyer of this model can still obtain the incentive directly from the Ministry by completing Aadhaar authentication of the e-voucher.
  3. Meeting the price ceiling and battery norms does not by itself make a model eligible; localisation is a separate and additional condition.
  • A. 2 and 3 only
  • B. 1 only
  • C. 1 and 3 only
  • D. 1, 2 and 3

Q3. Under the PM E-DRIVE Scheme, the demand incentive for an electric two-wheeler is calculated per kWh of battery capacity: ₹5,000 per kWh in FY 2024-25, falling to ₹2,500 per kWh in FY 2025-26. It is capped at the lower of a fixed per-vehicle amount and 15% of the ex-factory price. Only models with an ex-factory price of up to ₹1.5 lakh are eligible, and privately owned electric cars are not covered. Which of the following inferences can validly be drawn from the above?

  1. The design reduces per-unit support over time, consistent with an expectation that the cost of electric vehicles will fall as the market matures.
  2. Electric cars are left out because their adoption does not reduce petrol consumption in India.
  3. The price ceiling directs support toward mass-market models rather than premium ones.
  4. The subsidy on any eligible electric two-wheeler rises in proportion to its ex-factory price.
  • A. 1 and 2 only
  • B. 1 and 3 only
  • C. 2, 3 and 4 only
  • D. 1, 3 and 4 only

Q4. In the context of the climate benefits of electric mobility in India, consider the following statements: Which of the statements given above is/are NOT correct?

  1. The lifecycle (well-to-wheel) emissions of an electric vehicle depend on the carbon intensity of the electricity used to charge it.
  2. Because about half of India's installed power capacity was non-fossil by mid-2025, about half of the electricity generated in India also came from non-fossil sources.
  3. A source's share of installed capacity can exceed its share of generation when it runs for fewer hours in the year than other sources.
  • A. 1 only
  • B. 1 and 3 only
  • C. 2 and 3 only
  • D. 2 only

Q5. Consider the following assertion: Electrification of two-wheelers is among the most direct levers available for reducing India's crude oil import dependence. Which of the following statements support/supports the above assertion?

  1. India meets close to nine-tenths of its crude oil requirement through imports.
  2. Nearly all petrol consumed in India is used in transport, and two-wheelers account for the largest share of that petrol.
  3. India imports roughly half of its natural gas requirement.
  • A. 1 and 2 only
  • B. 2 and 3 only
  • C. 1, 2 and 3
  • D. 1 only

Q6. A country offers generous purchase subsidies for electric vehicles. It has little domestic battery-cell manufacturing and attaches no localisation condition to the subsidy. Which one of the following is the most likely outcome in the short run?

  • A. Little change in EV sales, as purchase subsidies do not lower buyers' upfront cost
  • B. Rising EV sales accompanied by a rising import bill for battery cells
  • C. Rising EV sales accompanied by a falling import bill for battery cells
  • D. Rapid domestic cell production driven by the subsidy alone, cutting cell imports