E-scooter policy scuttled by vested interests: SMEV
Alisha Sachdev
SYNOPSIS
The government has withheld incentives after allegations of fraudulent claims surfaced
The electric-scooter industry is split down the middle on the allegations of foul play to claim FAME-II (Faster Adoption and Manufacturing of Electric and Hybrid Vehicles in India) subsidies by a few original equipment manufacturers, industry executives said.
While the Society of Indian Automobile Manufacturers (SIAM) has not approached the Centre, urging it to release FAME-II subsidies for member companies, the Society of Manufacturers of Electric Vehicles (SMEV) alleged that “detractors” with vested interests are trying to get the most advanced electric two-wheeler companies out of the FAME-II subsidy programme.
“All SIAM members have been compliant with FAME-II rules, and no discussion about frozen subsidies is being held by SIAM as an organization,” one of the people said, seeking anonymity.
SIAM represents India’s largest legacy firms manufacturing internal combustion engine vehicles and new original equipment manufacturers (OEMs) and startups in the EV segment. Additionally, the industry body is actively engaging with the government on the new battery testing standards.
SMEV represents many electric mobility startups, including Greaves Cotton-owned Ampere Vehicles, Kinetic Green Energy, Hero Electric, Tork Motors and Okinawa Autotech. It also counts electric three-wheeler firms and component suppliers as members. Okinawa is also a new member of SIAM.
Under the government’s ₹10,000 crore FAME-II scheme, cash subsidies of up to ₹15,000 per kilowatt hour battery are given to EV manufacturers who meet the localization norms under the phased manufacturing programme.
A slew of complaints alleging fraudulent subsidy claims by leading electric two-wheeler OEMs Hero Electric and Okinawa have surfaced, Mint reported.
This led the Centre to withdraw the incentives for these manufacturers till the ministry of heavy industries submitted its investigation report on whether the firms failed to meet localization criteria.
After petitioning the Parliamentary Standing Committee on Electric and Hybrid Mobility, SMEV shot off a letter to the media earlier this week detailing “anonymous campaigns” trying to get pioneering EV firms out of business by turning a formerly sympathetic regime against these companies.
“Something strange is happening in the E-Mobility space. A wonderful and well-planned, and almost well-executed policy so far has been suddenly put to the test – with premeditated disaster as almost a certain outcome. How did this come to be?” it said in the unsigned letter. “Normally, such anonymous campaigns (referring to whistleblower emails sent to the government) should not have rattled anyone. But strangely, the startups started progressively being cold-shouldered, and subsidy allocation was withheld.” “Clearly, this was not a campaign by some wet behind-the-ears do-gooder… it was a cabal acting in concert with some special interest groups because, one by one, the insinuations started piling up against the startups. These are new players without the deep pockets of fuel-based scooter companies. They will collapse without subsidies. So an unusual situation has been created, where companies serving the government’s policy by starting the e-scooter revolution are being edged out of the market by an anti-e-mobility policy group.”
People in the know said Okinawa Autotech and Hero Electric are looking to approach the court to claim FAME-II subsidies which were passed on to the customers but were not reimbursed. SMEV said approximately ₹1,000 crore in subsidy backlog had not been paid to the industry.
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