The Electric Vehicle Manufacturers Association on Tuesday said it has petitioned the National Green Tribunal (NGT), expressing concern over the government’s move to cut FAME II subsidy and support a “green tax” on fuel-burning two-wheelers.
The Society of Manufacturers of Electric Vehicles (SMEV) said in the petition that the Ministry of Heavy Industries’ latest decision to cut FAME II subsidy may disrupt the growth of the Indian electric vehicle industry, thereby adversely affecting the country’s environmental and health indices.
It added that the Ministry of Industry and Information Technology suddenly decided to cut subsidies by 75%.
SMEV further said it has “requested NGT’s support for the imposition of green tax on fuel-burning two-wheelers to incentivize the adoption of green vehicles and contribute to the country’s goals of environmental protection and pollution reduction”.
“Subsidies for electric vehicles are being offered around the world with the aim of promoting a massive shift to non-polluting energy systems,” said Ajay Sharma, secretary general of SMEV.
He further said, “The department’s decision goes against this consciousness and is an anomaly that defies logic or law, especially since electric vehicle manufacturers are emboldened to transfer technology, labor, capital and enterprises to this field based on the government’s expressed support.”
Many OEMs are unable to cope with the financial pressure caused by the ministry’s action as the subsidy amount exceeds Rs. SMEV said Rs 1,200 crore has been put on hold and further sought retrospective repayment of the subsidy given in 2019.
“In fact, it is only a matter of time before they close due to a lack of working capital, loss of investor and bank support, delayed production schedules and a rapidly disappearing distribution network,” the statement added.
