SMEV Accuses E2W Start-ups of Collusion; More EV Manufacturers May Lose Subsidies

The EV industry organisation now believes that the call to withdraw the subsidy is being made with ulterior purposes after calling for the restoration of suspended subsidies worth INR 1100 crore.

The Parliamentary Panel on Hybrid and Mobility has received a petition from the Indian industry group for EVs, the Society of Manufacturers of Electric Vehicles (SMEV), alleging wrongdoing in the termination of subsidies for a particular line of electric two-wheelers.

Government subsidy refunds for 12 electric two-wheelers that allegedly don’t adhere to the standards are still pending. These manufacturers of electric vehicles are thought to hold a combined market share of more than 60%.

6 more EV start-ups are set to be added to the list of suspected defaulters, according to industry sources.

The EV industry group claimed in a petition submitted earlier that E 2-wheeler start-ups were receiving subsidies despite not matching the localisation requirements outlined in the FAME II policy, citing a number of emails from a certain Akash Sharma, CA, CFA. The petition from SMEV asks, “Is Akash Sharma operating independently—or on behalf of a group that wants to destroy the entire EV edifice of the country? Is he working for some people and against others in the EV sector? Remember, he targets only start-ups in the E two-wheeler sector.”

According to FAME policy, which is required in order to submit a claim for subsidy reimbursement, Hero Electric and Okinawa Autotech have been prohibited from uploading production information to the government’s DIDM (Demand Incentive Disbursement Mechanism) web page since September.

“All the affected products were approved by government testing agencies,” Manu Sharma, Category Head for E2W and SMEV, added. According to reports, the Ministry of Heavy Industries has received accusations “about the theft of subsidies” against 12 EV manufacturers. According to an official document, the allegations are “mostly linked to the breach of Phased Manufacturing Programme (PMP) criteria” under the FAME II scheme, which aims to accelerate the adoption of EVs in India by providing financial incentives to end users. Victory Electric Vehicles International Thukral Electric Bikes, Lohia Auto Industries, and Avon Cycles are some of the participants who have been the target of complaints. In addition, Hero Electric, Benling India Energy, Okinawa Autotech and Technology, Jitendra New EV Tech, Okaya EV, Greaves Electric Mobility, Kinetic Green Energy & Power Solutions, Revolt Intellicorp, and Avon Cycles also made complaints.

Although there is no incentive for the consumer, all of the impacted two-wheeler EV manufacturers can continue to sell their goods. An industry executive claims that the typical incentive is between INR 30,000 and 40,000.

In its petition, SMEV further asserts that the affected individual “sent emails directing the Ministry officials to stop approving the new models of these very companies whose subsidies he got suspended.”

Up to 1.2 million electric two-wheelers were expected to be sold domestically during the current fiscal year. However, the suspension of subsidies may alter the sales trend. At least two business leaders claim that sales of electric 2-wheelers could reach 7,50,000 units by the end of the fiscal year.