The minister of state for Heavy Industries, Krishan Pal Gurjar, has confirmed that two electric vehicle OEMs have been suspended from the FAME scheme, in a written reply to the Lok Sabha.
The Ministry of Heavy Industries formulated the Faster Adoption and Manufacturing of Electric Vehicles in India Phase II (FAME India Phase II) Scheme for five years commencing from April 1, 2019, with a total budgetary support of Rs 10,000 crore.
This phase mainly focuses on supporting the electrification of public & shared transportation and aims to support through demand incentives 7090 e-Buses, 5 lakh electric three-wheelers, 55,000 electric four-wheeler passenger cars and 10 lakh electric two-wheelers. In addition, the creation of charging infrastructure is also supported under the Scheme.
Under phase II of the FAME India Scheme, about 7,40,722 electric two-wheelers have been sold as of 20.07.2023. Further, MHI sanctioned 6,315 electric buses to 65 cities/STUs/State Government entities for intracity operations. At present no proposal to launch FAME III is under consideration in the Ministry of Heavy Industries.
The Ministry of Heavy Industries has received seventeen complaints regarding the misappropriation of subsidies under the Government’s FAME India Phase II scheme by some electric vehicle manufacturers.
The complaints are mainly related to the violation of Phased Manufacturing Programme (PMP) guidelines under FAME India Scheme Phase-II. All the complaint cases have been referred to the testing agencies for re-verification.
After examination of reports in respect of two OEMs, the models of these two OEMs have been suspended from the FAME scheme. Further, the processing of their pending claims has been stopped till they submit sufficient evidence to show their compliance with PMP timelines.
The news comes at a time when companies are in the process of making investments and getting their products certified by Testing Agencies of the Ministry of Heavy Industries (MHI). Post-certification, companies are expected to submit claims after meeting the criteria for threshold investment and threshold sales of eligible products.
Since EVs classify as an AAT product, they come under the PLI scheme and as reported by the approved applicants under this PLI Scheme, investment up to March 31, 2023, is Rs 8,898 crore. However, no claim has been received for the FY 2022-23 and therefore there is no disbursement.
