The Indian government is contemplating reinstating financial assistance to electric two-wheeler manufacturers, including Revolt Motors, Greaves Electric Mobility, and Amo Mobility, under its Electric Mobility Promotion Scheme 2024 (EMPS 2024).
However, other players such as Hero Electric, Okinawa Autotech, and Benling India might face exclusion from all future government schemes, according to an official familiar with the matter. This decision follows Revolt, Greaves, and Amo Mobility voluntarily returning wrongfully claimed subsidies to the government, demonstrating a commitment to rectifying past discrepancies. Conversely, Hero Electric, Okinawa, and Benling India are yet to reimburse the subsidies and have resorted to legal action against the government’s recovery notices. The government’s scrutiny into violations of vehicle localisation norms, mandated under the Faster Adoption & Manufacturing of Electric Vehicles in India (FAME India) scheme, prompted recovery notices amounting to ₹469 crore issued to these companies for sales made between 2020 to 2023.
In response to the companies’ non-compliance, they have been excluded from all schemes under the Ministry of Heavy Industries (MHI), with further measures underway to blacklist them from all government schemes. Regarding the potential reinstatement of subsidy benefits to select electric two-wheeler manufacturers, the official disclosed that the Ministry of Heavy Industries is awaiting approval from the finance ministry. Notably, Revolt, Greaves, and Amo Mobility have reimbursed approximately Rs 170 crore to the government.
The FAME scheme, initiated in 2015 with a budget of ₹895 crore, aimed to bolster the sale of locally manufactured electric vehicles. Its successor, FAME II, launched in 2019 with an outlay of Rs 10,000 crore, aimed to further promote electric vehicle adoption. However, instances of non-compliance with the phased manufacturing programme (PMP) led to a misalignment between subsidy disbursals and localisation requirements, undermining the scheme’s objectives. FAME II, operational from 2019 to 2024, contributed to the sale of nearly 1.4 million e-2Ws, 161,000 e-3Ws, and 20,556 electric four-wheelers, focusing on increasing localisation content in domestically manufactured EVs over time.
As the government navigates through rectifying past discrepancies and realigning incentives to promote electric mobility, the reinstatement of support to select manufacturers underscores a renewed commitment to fostering sustainable growth in the electric vehicle segment. A spokesperson for Okinawa said, “We have filed a writ petition in Delhi High Court to recover our outstanding FAME II dues of upwards Rs 425 crore and our case is subjudice. Okinawa Autotech always has been compliant with the scheme guidelines and the same was observed by MHI’s committee headed by Joint Secretary, Mukta Shekhar”.
“Okinawa has not availed incentives from the beginning of the last financial year and we believe the electric two-wheeler industry has reached a stage where it is self-sufficient,” the spokesperson said. According to MHI officials, the report by Joint Secretary Mukta Shekhar has not been accepted by the Centre and a fresh probe into the FAME scheme has been ordered. Further, the new investigation did not concur with findings of the Shekhar report.
