The Society of Manufacturers of Electric Vehicles sought Tuesday extension of subsidies for EVs in the FAME II scheme. It also included light-to-heavy commercial vehicles to encourage electric mobility.
The industry body called for a uniform 5% GST on spare parts for electric cars in its pre-Budget recommendations.
“FAME II’s validity will expire March 31, 2024. Society of Manufacturers of Electric Vehicles (SMEV), stated in a statement that FAME’s validity should be extended as we have not achieved the penetration the subsidy was supposed.
It was also stated that the FAME II program should be linked with e-mobility conversion and not time-based.
According to the EV industry body, market trends indicate that e-mobility (especially electric two-wheelers) will continue to grow once it reaches 20% of the overall two-wheeler market.
It stated that the subsidy could be reduced in the future, and added that the FAME II scheme should include provisions for direct transfer of the subsidy to customers.
SMEV also recommended the inclusion of light commercial vehicles, medium and heavy commercial vehicle (LCV), on a project-mode model as India must prepare for the transition from e-mobility in trucks to heavy commercial vehicles within three to four years.
It stated that FAME should be expanded to include commercial vehicles as a project-based option. Trucks account for more than 40% of India’s fuel consumption today and produce over 40% of India’s greenhouse gas emissions.
SMEV also requested the expansion of FAME II subsidies to electric tractors. SMEV stated that while electric vehicles are subject to a 5% GST, spare parts are not. Therefore, the industry pays only 28% in tax.
It stated that the request was to levy a uniform 5% GST on all EV spare parts.
