FAME-II guidelines clear and companies defaulted knowingly, says govt

The ministry has started the investigation in the cases of subsidy violation in April last year to probe procedural lapses and role of officers that led to the funds wrongly being disbursed

The Centre has asserted that the Faster Adoption and Manufacturing of Electric (& Hybrid) Vehicles in India (FAME-II) guidelines were clear and the companies defaulted the guidelines knowingly. 

The Ministry of Heavy Industries has formed a panel headed by the Additional Secretary to investigate the FAME-II scam and the role of government officials responsible for the Faster FAME-II subsidy irregularity.

“The committee has been investigating the issue for some time. According to the first part of its report, where, after examining all notifications and guidelines, the concerned testing agencies as well as officials of the auto section of MHI, effectively concluded that scheme notification and guidelines were clear and well understood by all relevant stakeholders, including test agencies, OEMs and MHI,” government officials said. 

On the issue of localisation requirements, the panel said that the timelines for localisation were framed in due consultation with all stakeholders, including industry players and testing agencies. It was also observed by this panel that the concerned testing agencies followed a uniform and consistent procedure during the enquiry process. 

“This report has been accepted by the competent authorities,” the official said. 

This latest report of the committee also points out numerous gaps, limitations and shortcomings in the earlier report dated December 30, 2023, of the Joint Secretary, MHI, some of which were highlighted by the Joint Secretary in the earlier report, dated 30.12.2023.

The ministry had begun the investigation for cases of subsidy violation in April last year to probe procedural lapses and the role of officers that led to the funds being wrongly disbursed.  

The Joint Secretary came out of a report dated December 30, 2023. It is learnt that in February 2024, the report dated December 30, of the Joint Secretary, MHI found to be vague, incomplete and suffering from numerous shortcomings and contradictions, such as failure to properly consider the scheme guidelines and failure to examine any officials, the official added. 

“This report was not accepted by the competent authority. Thereafter, the competent authority had entrusted the entire investigation of the matter to an independent five-member committee headed by an officer of the rank of Additional Secretary, Government of India,” the official said. 

The move comes several months after the ministry instructed 13 companies to reimburse improperly claimed subsidies. 

Of these, six automakers, Hero Electric, Okinawa Autotech, Ampere Vehicles (Greaves Cotton), Benling India, Revolt Intellicorp, and Amo Mobility, were found to be using imported products in violation of the phased manufacturing guidelines. These original equipment manufacturers (OEMs) have been asked to pay around Rs 469 crore.