The grant is expected to create 313 new full time jobs for the British carmaker along with assisting in staff training and development programs.
The news follows a £100 million (AU$177.6 million) investment in Lotus by owners DRB-HICOM and an announcement in July that the carmaker was recruiting for more than 130 new jobs.
Upon announcing the grant, UK Business Secretary, Vince Cable, said the automotive manufacturing industry was important to Britain.
“Lotus is an iconic British carmaker, with some of the most innovative engineers in the business,” Mr Cable said.
“The car industry is one of Britain's great success stories, employing over 130,000 people and helping to build a stronger economy by contributing £11 billion (AU$19.5 billion) a year.”
Lotus’ Chief Operating Officer, Aslam Farikullah, said the grant would assist in a wider strategy for the carmaker.
“We have very exciting plans for our sports cars and it’s a very positive move for Lotus that we’re in a position to create new jobs and to significantly contribute to Britain’s automotive industry,” Mr Farikullah said.
“The team here at Lotus have worked very hard to secure this grant and every employee is playing their part in the stability, growth and future success of our company.”