Government sends notices to EV firms for information to back subsidy claims – EQ Mag Pro
Specifically, the ministry wants to check if the components used in the vehicles being produced by EV makers are largely locally-sourced
The scheme stipulates that at least 50% of the total value added to an EV should be done locally by EV companies to receive the subsidy
Hero Electric and Okinawa have reportedly been asked to show documents to support their claims, with a few others also receiving notices
The Ministry of Heavy Industries has sent notices to several electric vehicle (EV) makers, asking them to furnish documents to back their claims to avail of the benefits provided under the INR 10,000 Cr Phase II of the Faster Adoption and Manufacturing of Electric and Hybrid Vehicles scheme, also known as FAME-II scheme.
Specifically, the ministry wants to check if the components used in the vehicles being produced by EV makers are largely locally-sourced. The scheme stipulates that at least 50% of the total value added to an EV should be done locally by EV companies to receive the subsidy, reducing the final price to the end customer.
Under the FAME-II scheme, the government has issued incentives worth INR 2,598 Cr so far.
According to an ET report citing government officials, Hero Electric and Okinawa have been asked to show documents to support their claims. A few other electric mobility companies are under investigation and might receive notices shortly, per the officials cited in the report.
The report added that the government has put the subsidies on hold for the two EV makers. The subsidy would be resumed if the two companies produce the necessary documents as proof of meeting the local value-addition requirements.
Per the FAME-II dashboard, none of the models from Hero Electric and Okinawa has an active certification from the ministry. All of the models show an expired certification which could have been the prompt for the ministry to send notices.
Without an active certification, EV models would not remain eligible for a subsidy from the government.
The incentives for Okinawa range between INR 17,000 and INR 54,000 per model, while Hero Electric’s incentives range between INR 18700 and INR 46360.
Other EV Players In The Catch
Revolt Motors and Ampere have also received similar notices, according to the aforementioned report. It is prudent to mention that Revolt is being acquired by RattanIndia Enterprises, which will acquire a 100% stake in the EV maker.
Per the ET report, the Automotive Research Association of India (ARAI) is conducting an audit at four other EV companies besides Hero Electric and Okinawa to see whether they are meeting the criterion for local value addition.
It is also prudent to mention that the government recently extended the deadline for EV makers to become compliant with the local value-addition norm. The latest deadline passed on September 30 and hence the government has started sending out notices.
The EV space in India is heating up, as HeroMotoCorp is set to launch its line of electric vehicles after seeing success with petrol two-wheelers. Per recent two-wheeler EV registration figures, Ola Electric reclaimed pole position in September with 9,616 units. The total two-wheeler EV registration in the month was up 2.3% month-on-month.