Why Hero Electric, Okinawa could be blacklisted from govt's future EV schemes

Hero Electric and Okinawa Autotech, two among the top electric two-wheeler manufacturers in India, could soon be blacklisted from upcoming schemes in the EV space. The Centre is planning to take action against EV makers who failed to return the incentives wrongly claimed under the Faster Adoption of Manufacturing of Electric Vehicles (FAME-II) scheme earlier. The two EV makers, along with four others were found flouting norms of the scheme which offered incentives to boost shift towards electric mobility.

The Ministry of Heavy Industries had conducted an investigation against EV makers who flouted FAME-II guidelines. Besides Hero Electric and Okinawa, these EV makers also include the likes of Benling India Energy and Technology, AMO Mobility, Greaves Electric Mobility and Revolt Motors. According to the Centre, these manufacturers flouted FAME-II norms by importing EV parts and not sourcing enough from the local markets - a key condition to avail benefits under the scheme. These six manufacturers were found at fault among 13 EV makers investigated by the Centre.

Out of the six EV makers, AMO Mobility, Greaves Electric Mobility and Revolt Motors have returned the subsidy amount wrongly claimed under the scheme. However, Hero Electric, Okinawa and Benling India have not yet returned their share of the incentives.

These three EV makers were de-registered from the scheme and are likely to be overlooked for other schemes. According to the ministry, these manufacturers have not replied to repeated mails sent to them regarding non-payment of incentives. News agency PTI quoted a senior official with ministry saying, “The next step is debarment from all schemes of the Ministry, that has been done for Hero Electric and Benling India. Okinawa was not debarred because they were in court at the time. The next step is blacklisting from all schemes under the Government of India. That has not happened so far because it is a step-by-step process and the Ministry of Finance gives the approval for debarment from all the ministries' schemes/policies for any company."

The upcoming Electric Mobility Promotion Scheme (EMPS) 2024 has replaced the FAME-II scheme which lapsed in April this year. With a budget of ₹500 crore, the scheme will be used to boost sale of electric two-wheelers and three-wheelers with the aim to develop India's EV infrastructure further. It will offer up to ₹10,000 as subsidy for electric two-wheelers, while three-wheelers will get up to ₹50,000. The scheme will remain in effect till July this year. The EV makers will receive reimbursement of the subsidies based on sale of their vehicle.

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