EV makers repay ₹312 crore FAME subsidy

October 16, 2023. — Several electric vehicle (EV) makers, including Hero MotoCorp, TVS Motor, Ather Energy and Ola Electric, have refunded ₹312 crore (INR 3.12 Billion) to the government. This action was taken for violating the guidelines of the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme.

The Ministry of Heavy Industries (MHI) has been actively monitoring the disbursement and utilization of subsidies under the FAME scheme. This aims to promote the adoption of electric vehicles and reduce vehicular emissions. Following intensive scrutiny, it was discovered that certain EV manufacturers had misrepresented or exaggerated the extent of their production and sales. Thus claiming a higher amount of subsidies than they were eligible for.

The Ministry of Heavy Industries fined seven enterprises a total of 469 crore for abusing the subsidies of the FAME-II scheme. The enterprises overcharged clients to exploit the scheme’s benefits. They separately billed clients for chargers and imported parts from abroad, misrepresenting them as products made in India.

Ather Energy has deposited 100 crore and given its consumers 58 crore in refunds. According to ministry sources, while Ola Electric has given its customers 115 crore in refunds and deposited 21 crore with the government. As part of the fine, TVS Motor has paid 16.32 crore and Hero MotoCorp has paid 2.23 crore.

The MHI has warned the defaulting companies of deregistration. They may also face debarment from future government schemes if they do not comply with the FAME guidelines. Revolt Motors had deposited ₹50 crore as a penalty earlier. The authorities have asked the company to submit a fresh application to get the subsidies.

In response to these events, the government has announced plans to strengthen the oversight mechanism. Furthermore, we intend to strengthen subsidy disbursement under the FAME scheme. This will implement stringent measures to verify the claims made by EV manufacturers, ensuring that we allocate subsidies only to those who genuinely contribute to the growth and proliferation of electric vehicles in the country.

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