An industry body for electric vehicle (EV) makers has written to a parliamentary committee against an investigation into alleged misappropriation of subsidies by some manufacturers. Some anonymous “detractors” were keen to derail e-mobility, it said.
The lobby, Society of Manufacturers of Electric Vehicles (SMEV), in its petition to the parliament standing committee on electric and hybrid mobility said “vested interest groups” were trying to scuttle the government’s e-mobility policy through an anonymous campaign.
SMEV was referring to anonymous emails sent to various government departments and media organisations alleging that several electric two-wheeler companies, including leading sellers Hero Electric and Okinawa Autotech, were wrongfully claiming subsidies under the government’s Faster Adoption and Manufacturing of Electric and hybrid vehicles (FAME) scheme.
ET is in receipt of these emails.
The FAME scheme stipulates that to receive subsidies, EV makers must comply with a strict localisation roadmap for the components used in their vehicles to promote the development of a local manufacturing ecosystem. The emails claimed many manufacturers were wrongfully declaring imported components as domestic to claim subsidies. They cited annual reports of the companies named and customs data.
The identity of the authors of these emails remains unknown. However, it is these emails that spurred an investigation into the matter by the ministry of heavy industries (MHI) , ET has reliably learnt.
“Clearly, this was not a campaign by some wet-behind-the-ears do-gooder,” the SMEV petition read. “Clearly, it was a cabal acting in concert with some special interest groups, because one by one the insinuations started piling up against the (EV) start-ups.”
A government source had earlier told ET that companies that are compliant with the FAME scheme and have “nothing to hide” should not fear the investigation. “If you are getting subsidies with the condition of localisation, is it not the right of the government to check if you are fulfilling that condition?” the source had said.
Multiple independent sources in the EV industry have told ET that it was an “open secret” that some manufacturers were wrongfully circumventing the localisation requirements of the FAME scheme. ET could not independently verify these claims.
As part of its investigation, MHI ordered India’s two recognised vehicle testing agencies to purchase back from customers electric two-wheelers sold with subsidies and dismantle them to check whether they contained local parts or imported ones, ET reported last month. The vehicles were chosen at random.
A report of this investigation has been recently submitted, according to one source.
Pending this investigation, MHI had paused the subsidies of EV makers for the past few months. The accumulated subsidies of several manufacturers have recently been released, according to multiple industry sources. However, subsidies of some of the key accused EV makers remain withheld.
The SMEV petition said that EV companies do not tend to have deep pockets like conventional automakers and hence “they will collapse without subsidies.”
“So, an unusual situation has been created, where companies that served the government’s policy and started the e-scooter revolution in India are now being edged out of the market by an anti e-mobility policy group,” the petition read.
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