The Heavy Industries Ministry spearheads an intense probe into subsidy misappropriations under the FAME India scheme. High-ranking officials are scrutinized for improper fund approvals, unveiling a scandal shaking the EV industry’s core.
The Heavy Industries Ministry is investigating officers for approving subsidies under the FAME India scheme to companies that didn’t meet requirements. Kamran Rizvi, Secretary of the Ministry, revealed that the probe includes examining the International Centre for Automotive Technology (ICAT) and the involvement of the Automotive Research Association of India (ARAI). Rizvi emphasized that the investigation focuses on procedural errors and officer roles in incorrect fund disbursement, with potential action against those involved.
The FAME scheme aimed to encourage domestic electric vehicle (EV) production, offering subsidies. However, several companies misused this by using imported components and still receiving financial support. As a result, the government issued Rs 450 crore in recovery notices to seven electric two-wheeler companies for not adhering to local sourcing norms. These firms are also banned from future scheme claims.
Two of the seven companies have already returned the funds. The government is actively seeking reimbursement from the remaining companies and interest. Additionally, four other companies were discovered to have manipulated vehicle pricing to gain subsidies. They have refunded the incorrect amounts and are compensating customers for the overcharges.
