The Ministry of Heavy Industries (MHI) has disqualified Hero Electric and Benling India from participating in any incentive programmes under the flagship Faster Adoption and Manufacturing of Electric Vehicles in India Phase-II (FAME-II) scheme.
This decisive action comes after the ministry uncovered violations of the phased manufacturing programme (PMP) guidelines by these companies, according to a report by Business Standard. The FAME-II schemes, a cornerstone of India’s electric vehicle (EV) policy, is designed to bolster the adoption and manufacturing of EVs by offering financial incentives to manufacturers and consumers alike. Central to this initiative are the PMP guidelines, which aim to increase domestic value addition in the production of electric vehicles and their components. According to senior officials, Hero Electric and Benling India failed to comply with these critical guidelines, prompting the ministry to issue recovery notices. The government had previously issued similar notices to Okinawa, indicating a broader crackdown on non-compliance within the industry.
The exclusion from the FAME-II scheme represents a significant setback for Hero Electric and Benling India, both of which have been prominent players in the burgeoning Indian EV market. The financial incentives provided under the scheme are crucial for maintaining competitive pricing and fostering market growth. Without access to these incentives, the companies may face substantial challenges in sustaining their market positions and achieving growth targets. The PMP guidelines under the FAME scheme are meticulously crafted to encourage manufacturers to source and produce a substantial portion of their components within India. This move aims to not only boost the domestic manufacturing sector but also reduce dependency on imported components, thereby fostering a self-reliant ecosystem.
The ministry’s decision underscores the government’s commitment to strict enforcement of these guidelines to ensure that the benefits of the FAME-II scheme are rightly channelled to compliant manufacturers. This step is expected to serve as a warning to other manufacturers about the critical importance of adhering to government regulations and guidelines.
Industry experts believe that the ministry’s stringent action may prompt other companies to reassess their compliance frameworks and manufacturing processes to align with the PMP guidelines. This could potentially lead to a more robust and self-sufficient EV manufacturing sector in India. As the EV market continues to evolve, the government’s focus on fostering domestic manufacturing capabilities will likely play a pivotal role in shaping the industry’s future. The repercussions of this latest development on Hero Electric and Benling India will be closely monitored, offering valuable insights into the effectiveness of regulatory enforcement in driving industry standards.
The Ministry of Heavy Industries’ exclusion of Hero Electric and Benling India from the FAME-II incentive scheme marks a significant regulatory intervention aimed at upholding the integrity of India’s EV manufacturing ambitions. This action highlights the critical balance between promoting industry growth and ensuring stringent adherence to policy guidelines.
