The Ministry of Heavy Industries (MHI) has taken decisive action against Hero Electric and Benling India by barring them from participating in any of its future incentive programmes. This move stems from the companies’ violations of the phased manufacturing programme (PMP) guidelines under the Faster Adoption and Manufacturing of Electric Vehicles in India Phase-II (FAME-II) scheme.
According to senior officials, the investigation revealed that both Hero Electric and Benling India failed to adhere to the PMP guidelines. These guidelines are a critical component of the FAME scheme, aimed at boosting domestic value addition in the electric vehicle (EV) sector. The PMP guidelines are designed to ensure that a significant portion of the manufacturing process and components are sourced domestically, thereby fostering the growth of local industries and reducing dependence on imports.
The decision to debar Hero Electric and Benling India for two years was made under the General Financial Rules. These rules govern the management of public finances and are intended to ensure that government funds are used effectively and in accordance with the law. The violations by Hero Electric and Benling India were deemed significant enough to warrant their exclusion from all MHI schemes for the stipulated period.
The FAME-II scheme is a flagship initiative of the Indian government aimed at promoting the adoption and manufacturing of electric vehicles in the country. It provides financial incentives for the purchase of electric vehicles and supports the development of charging infrastructure. The scheme is a crucial part of India’s strategy to reduce greenhouse gas emissions and improve air quality by encouraging the use of cleaner, more sustainable modes of transportation.
Hero Electric and Benling India are among the prominent players in the Indian electric vehicle market. Hero Electric is one of the largest manufacturers of electric two-wheelers in India, while Benling India is known for its range of electric scooters and other two-wheeled vehicles. The debarment from MHI schemes is a significant setback for these companies, as it not only affects their ability to benefit from government incentives but also impacts their market reputation and future business prospects.
The Ministry of Heavy Industries has been stringent in its enforcement of the PMP guidelines, reflecting its commitment to fostering domestic manufacturing capabilities. This move sends a clear message to all participants in the FAME-II scheme about the importance of compliance with the programme’s requirements. The ministry’s actions underscore the government’s broader objective of promoting self-reliance in the electric vehicle sector, in line with the ‘Make in India’ initiative.
Industry experts believe that the debarment of Hero Electric and Benling India could serve as a cautionary tale for other manufacturers. It highlights the need for strict adherence to the guidelines and regulations set forth by the government to qualify for incentives. This incident may also prompt a review of compliance practices among other companies participating in the FAME-II scheme.
While the immediate impact on Hero Electric and Benling India is clear, the broader implications for the electric vehicle industry in India remain to be seen. The government’s firm stance on enforcing PMP guidelines could lead to increased scrutiny of other manufacturers and potentially more debarments if similar violations are discovered. However, it also reinforces the government’s dedication to building a robust and self-sufficient domestic EV manufacturing ecosystem.
In conclusion, the debarment of Hero Electric and Benling India from all Ministry of Heavy Industries’ incentive schemes for two years underscores the critical importance of compliance with the FAME-II scheme’s PMP guidelines. This action reflects the government’s unwavering commitment to promoting domestic value addition in the EV sector and serves as a stark reminder to all industry participants about the consequences of non-compliance.
