The Ministry of Heavy Industries (MHI) has said that it was happy to hear that some electric vehicle makers are giving vehicle chargers free of cost to consumers, which would boost the adoption of electric vehicles (EVs) in the country.

The development comes after the Ministry issued show cause notices to most of the original equipment manufacturers (OEMs) last month for not adhering to the government’s guidelines of localisation and charging extra from the customers.

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Sources from the Ministry said the complaints are mainly of two types under the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles in India (FAME) Scheme Phase II.

“One is related to the violation of phased manufacturing programme (PMP) guidelines under the scheme. The PMP requires that various components of EVs are manufactured in India. Timelines have been given for indigenisation for the components covered under PMP. The second type of violation relate to overpricing by charging extra for vehicle charger and upgraded software,” a senior official at MHI told businessline.

Complaints were received in the Ministry that some OEMs are selling EV chargers and upgraded software separately and the overall price of consumers exceeded the ceiling of ₹1.5 lakh under the FAME-II scheme for electric two-wheelers, the official said.

“It may be noted that several manufacturers such as Ola and Ather have now publicly announced that they would be giving vehicle chargers free of cost to the customers. This is a big win for consumers and will further boost the adoption of electric vehicles in the country,” he said.

The complaints regarding PMP violations have been referred to the testing agencies for verification. The test agencies check for sourcing of parts, conduct plant audits and perform strip-down tests on vehicles to check the use of imported parts in the vehicle. These tests are typically performed in the presence of company representatives and are video graphed, the official explained.

Sources in the know of the matter have informed that the enquiries against four OEMs — Hero Electric, Okinawa, Okaya EV, and Kinetic Green — by the testing agencies have since been completed and submitted to the Ministry.

“In respect of Hero Electric and Okinawa, the report concludes that there has been rampant use of imported parts which is a clear violation of PMP guidelines by these two OEMs. The PMP parts which should have been manufactured within India have been imported,” said another source from the government.

The MHI has taken cognisance of this report and is in the process of taking remedial action. This would involve recoveries of incentives claimed wrongly by Hero Electric and Okinawa since 2019-20, which amounts to around ₹200 crore. Further, steps will be taken to de-register them from the FAME scheme, the official sighted above said.

Sources further informed that test agencies have submitted two more enquiry reports to the Ministry, i.e. Okaya EV and Kinetic Green. No violations of PMP guidelines have been found and the Ministry is taking steps to release the subsidy amount withheld in respect of these two OEMs.

“It is likely that enquiry reports in respect of the remaining manufacturers will be submitted by the test agencies within two weeks,” the source added.

FAME II scheme commenced on April 1, 2019, for a period of three years, which was further extended for a period of two years up to March 31, 2024, and the total outlay for FAME Scheme Phase II is ₹10,000 crore.

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