ET on August 24 reported, citing industry executives, that the companies would find it difficult to meet the September 1 deadline for implementing the new requirement under the Faster Adoption and Manufacturing of Electric and Hybrid Vehicles (FAME)-II, because the systems would not be in place.
The ministry note said it extended the deadline considering the request of the manufactures registered under the scheme for more time to adopt the software systems.
ET has seen a copy of the note, sent on September 1. The ministry did not respond to ET’s queries till press time Friday.
Meetings between the ministry and vehicle makers were held in August to understand the changes to rule better and the call was taken after that, an industry executive said.
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ET reported on August 24 that the government was working on a digital mechanism, following multiple allegations against some EV companies for availing of FAME-II subsidy despite importing almost all the components and making very minimal value addition within the country.
The FAME-II policy stipulates a certain level of localisation in India, but companies have found ways around the law to avail of the subsidy, experts said.
Currently, for two-wheelers, the localisation — the use of locally made components — of a product has to be at least 50% before a vehicle maker can take FAME-II benefits.
Information on the percentage of localisation is submitted to the testing agency – Automotive Research Association of India – at the time of certifying the vehicle, before sales.
Under the additional rule, companies will have to update on the government’s FAME portal about the value addition at each stage of manufacturing through a digital mechanism. The percentage derived will have to match the localisation percentage as submitted to the ARAI.
