FAME-II: Greaves Electric Offers To Repay INR 125 Cr Subsidy For Violation Of Norms

SUMMARY

Greaves has initiated the process to reimburse approximately INR 124.91 Cr of subsidy, becoming the second company to do so

Greaves and six other electric two-wheeler manufacturers have been accused of availing the subsidies under the FAME-II scheme without meeting the localisation requirements

In August, Revolt Intellicorp, an electric vehicle manufacturer owned by RattanIndia, paid a penalty of INR 50.02 Cr to the government

Greaves Electric Mobility, previously known as Ampere EV, has reportedly offered to repay to the government the INR 125 Cr of subsidy received under the second phase of the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India.

Greaves has reached out to initiate the process to reimburse approximately INR 124.91 Cr, becoming the second company to do so, ET reported citing a government official.

Greaves and six other electric two-wheeler manufacturers have been accused of availing the subsidies under the FAME-II scheme without meeting the localisation requirements.

It must be noted that the government has issued recovery notices totalling INR 150 Cr to seven companies, including Hero Electric, Okinawa Autotech, Ampere EV, Revolt Motors, Benling India, Lohia Auto, and AMO Mobility.

While Hero Electric was asked to pay the highest amount of INR 133.48 Cr, Ampere was expected to pay INR 124.91 Cr. Okinawa was asked to return INR 116.85 Cr.

The notices were a consequence of the failure of these companies to adhere to the local sourcing norms mandated under the FAME-II scheme to qualify for the incentives. Additionally, these companies have been prohibited from making future claims under the scheme.

In August, Revolt Intellicorp, an electric vehicle manufacturer owned by RattanIndia, paid a penalty of INR 50.02 Cr to the government for violating the guidelines of the FAME scheme.

The Indian government introduced the FAME-II scheme in 2019 with the goal of promoting the electrification of private and shared transportation. The program aimed to provide demand incentives for various categories of electric vehicles, including 7,090 electric buses, 5 lakh electric three-wheelers, 55,000 electric passenger cars, and 10 lakh electric two-wheelers, with a total budget allocation of INR 10,000 Cr.

However, the government cut the subsidy amount offered under the scheme after the cases of violation of norms came to light. This also affected the sales of electric two-wheelers earlier this year.