Government Suspends FAME-II Subsidies for Two EV Makers, Requires Proof of Localisation Compliance
- ByStartupStory | March 22, 2023
Minister of State for Heavy Industries, Krishan Pal Gurjar, has announced that the government has halted the processing of pending FAME-II subsidy claims for two electric vehicle (EV) manufacturers. This action has been taken until the companies provide adequate proof of their compliance with the conditions of the scheme.
Krishan Pal Gurjar, Minister of State for Heavy Industries, has revealed that two electric vehicle (EV) manufacturers have had their FAME-II subsidy claims suspended by the government. This decision was made after the examination of reports for these two original equipment manufacturers (OEMs) showed that their models did not comply with the scheme’s conditions. In a written response to a question posed in the Lok Sabha, Gurjar stated that the processing of the two companies’ pending claims would remain halted until they submit sufficient evidence demonstrating their adherence to the phased manufacturing plan (PMP) timelines.
The government has issued notices to Hero Electric and Okinawa for their failure to meet the requirements to claim subsidies under FAME-II, as reported by ET on October 7, 2022. The models of these companies have been removed from the list of those eligible for availing of the subsidy, as stated on the FAME website. Minister of State for Heavy Industries, Krishan Pal Gurjar, mentioned that the ministry has received complaints regarding the misuse of subsidies, specifically with regards to non-compliance with localisation norms.
The FAME website reveals that the models of Hero Electric and Okinawa are no longer eligible to receive subsidies. The Minister of State for Heavy Industries, Krishan Pal Gurjar, has reported that the MHI has received complaints of subsidy misuse, particularly concerning violations of localisation norms. Hero Electric and Okinawa are facing allegations of falsely claiming locally sourced components to avail subsidies, as it has been reported that they mostly use imported parts in their vehicles. On March 13, reports had stated that the companies may challenge the government in court, citing the unavailability of some components in India.
Ather Energy, Hero MotoCorp, Ola Electric, and TVS Motors are among the companies that have been accused of underpricing their vehicles below Rs 1,50,000 to claim FAME-II subsidies, as per recent reports. Minister of State for Heavy Industries, Krishan Pal Gurjar, has stated that all complaints have been referred to testing agencies for further verification. The FAME-II scheme aimed to sell one million electric two-wheelers, 500,000 e-three wheelers, 55,000 four wheelers, and 7,000 electric buses via the subsidy scheme in five years, starting from April 2019. When questioned about the delay in achieving these targets, Minister of State for Heavy Industries, Krishan Pal Gurjar, was asked about the government’s strategy to expedite the process and meet the targets on time.
As of February 15, the FAME-II scheme has sold 792,529 e-two wheelers, 81,172 e-three wheelers, 6,831 e-four wheelers, and 2,435 e-buses. The government is considering not extending the scheme beyond March 2024, as reported by ET on March 7. Three-wheeler EV manufacturers are also seeking a 50% increase in their subsidy amount due to low sales under the scheme. Additionally, the Ministry has approved 2,877 electric vehicle charging stations in 68 cities and sanctioned 1,576 charging stations along nine expressways and 16 highways under FAME-II.
Follow Startup Story
Related Posts
