FICCI urges govt to extend FAME-II for two years

By Author  |  Published: 2nd Jul 2020  7:38 pm

Mumbai: Industry body FICCI on Thursday recommended various measures, including the continuation of the FAME -II scheme till 2025, to enhance demand for electric vehicles. The recommendations, submitted by FICCI’s EV committee to the government, seek immediate support from policymakers to enhance attractiveness for these vehicles in the short term and to encourage continued investments in the sector, a release said. These suggestions have been submitted to NITI Aayog, the Department of Heavy Industry, Ministry of Road Transport and Highways and other relevant authorities in the government, it said.

The industry body has also requested the government to take certain steps urgently to prevent derailment of the sector and to help create demand, so that India can attain leadership in EV technology and sales. “As demand and investments in the electric vehicles sector are severely hit due to disruptions caused by Covid-19, FICCI has suggested to the government, a series of measures to ensure continuity of the EV growth road map and achievement of the targets as envisioned by the government for the sector in the next decade,” the FICCI release said.

The industry body is however apprehensive about the adverse impact of introduction of this green technology due to factors such as reduction in demand for automobiles, higher risk aversion among customers towards new technology, disruption in supply chain, among others. “There is also a likelihood of reduction in demand for shared mobility leading to reduced demand for electric three-wheelers and postponement of investments in EV technology by local component makers,” FICCI stated.

Despite these short term setbacks, India must continue to encourage EVs along with all other electrified vehicle technologies, such as plug-in hybrid electric vehicles , strong hybrid electric vehicles  and fuel cell electric vehicles. This would also be in line with the country’s long-term vision towards electric mobility to lessen air pollution, achieve fuel security and technology leadership in this sector, FICCI said.

The other recommendations include a review to improve the e-buses procurement criteria and scheme design under FAME II with industry consultation to promote e-buses, as well as a Rs 10 crore support towards setting up in-house R&D infrastructure to come up with Make-in-India product and develop advanced technology for EV two-wheelers. FICCI has also sought formulation of a policy to incentivise all major e-commerce players to convert their last-mile delivery operations to all-electric by 2025, in a staggered manner.