FAME scanner: MHI received complaints against 17 OEMs, says Minister

The Ministry of Heavy Industries (MHI) said that it has received complaints against 17 OEMs under the Faster Adoption and Manufacturing of Electric Vehicles in India (FAME) India Scheme Phase-II in the past 18 months. These mainly pertain to two aspects, PMP compliance and Breach of Ex-factory price. Further, incentive payments were stopped, in case of complaints, wherever detailed investigations were required.

The Minister of State for Heavy Industries Krishan Pal Gurjar in a written reply in Lok Sabha on Tuesday said that steps were undertaken by MHI for the investigation of complaints against the alleged Original Equipment Manufacturers (OEMs) including disbursement of the demand incentives were put on hold, and the matter was referred to Testing agencies of MHI for detailed investigation. After the examination of reports from testing agencies, it was found that six OEMs were fully PMP Compliant while other seven OEMs have been found to be violating PMP norms, said the Minister.

He further added that four OEMs have agreed to refund the excess amount for the Breach of Ex-factory price to the customers/purchasers of electric vehicles (EVs).

The Ministry of Heavy Industries formulated the FAME India Phase II Scheme for a period of 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 and shared transportation, and aims to support through demand incentives, 7,090 buses, 5 lakh e-3 Wheelers, 55,000 e-4 Wheeler Passenger Cars, and 10 lakh e-2 Wheelers. In addition, the creation of charging infrastructure is also supported under the Scheme.  
 
Under Phase-II of FAME India Scheme, 8,47,578 electric vehicles amounting to around Rs 4,157 crore have been sold by the electric vehicle manufacturers to consumers as on July 28, 2023.

This includes 7,53,140 (2-wheelers), 85,168 (3-wheelers), and 9,270 (4-wheelers). Further, MHI sanctioned 6,315 electric buses to 65 cities/STUs/State Govt. entities for intracity operations.

Under the FAME-India Scheme Phase-II, no incentive is given to EV manufacturers. The incentive/ concession is provided to consumers (buyers/end users) in the form of an upfront reduced purchase price of hybrid and electric vehicles to enable wider adoption, which will be reimbursed to the OEM (EV manufacturers) by the Government of India.

There is no State-wise priority deadline for the deployment of e-buses sanctioned under the Scheme. However, all the selected cities/STUs for procurement of e-buses have to follow the timeline as given in the Expression of Interest (EoI) dated June 4, 2019, issued by the Ministry of Heavy Industries, said the Minister.
 
In order to promote the manufacture and use of electric vehicles in the country, the Government launched the FAME India Scheme in 2015 on a pan-India basis, with an aim to reduce dependency on fossil fuel and to address issues of vehicular emissions. At present, the Phase-II of the FAME Scheme of India, which started in 2019 for a five-year period, is in its fifth year of implementation.

Further, the following steps have been taken by the Government for the adoption of electric vehicles in the country:

The Government on 12 May, 2021 approved a Production Linked Incentive (PLI) scheme for the manufacturing of Advanced Chemistry Cell (ACC) in the country in order to bring down prices of batteries in the country. A drop in battery price will result in cost reduction of electric vehicles.

Electric Vehicles are covered under the Production Linked Incentive (PLI) scheme for Automobile and Auto Components, which was approved on 15 September, 2021 with a budgetary outlay of Rs 25,938 crore for a period of five years.

GST on electric vehicles has been reduced from 12% to 5%; GST on chargers/ charging stations for EVs has been reduced from 18% to 5%. Ministry of Road Transport & Highways (MoRTH) announced that the battery-operated vehicles will be given green license plates and be exempted from permit requirements. MoRTH issued a notification advising states to waive road tax on EVs, which in turn will help reduce the initial cost of the EVs, said the Minister.