EV policy needs to be rejigged to make it more effective: Hero Electric

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New Delhi: The country’s electric vehicle (EV) policy needs to be “rejigged” and requires “course correction” in order to make it more effective to achieve envisaged sales targets, according to the country’s leading electric two-wheeler maker Hero Electric.

Under the FAME-II scheme, which was launched in April 2019, the plan was to put at least 10 lakh high-speed electric two-wheelers on the road by March 2022.

But with two years already over, the number of electric two-wheelers on the road remains low at around 60,000 units. In 2020, just 25,735 units of high-speed electric two-wheelers were sold in the country.

“We are now two years down in the policy and there is only one year to go. But if you look at the number of vehicles which have benefitted, it is just around 60,000 units. It should have been six lakh plus by now. So something is not working. So that is where the policy now needs to be kind of rejigged,” Hero Electric Managing Director Naveen Munjal told PTI.

Under the second phase of the Faster Adoption and Manufacturing of Electric Vehicles in India (FAME-II) scheme, 10 lakh registered electric two-wheelers with a maximum ex-factory price are eligible to avail incentive of Rs 20,000 each.

Currently, only high-speed electric two-wheelers qualify for incentives under the FAME -II scheme.

“It is like when we launch any new product or new publication etc where you are constantly observing if the goals are being met. If it’s not, then we do some course correction. So like that this policy needs a course correction as well because it is not working in the way it should have,” Munjal noted.

Elaborating further he said that the policy has brought in too many considerations regarding speed, range, etc which has throttled the growth of the sector.

“There are too many parameters that they have put in regarding speed, range, etc..that is not the right way. What should be happening is that they should front-load the subsidies. If the target is to convert a certain number of two-wheelers with internal combustion engines to electric, there has to be front-loading of subsidies,” Munjal said.

And if it is a low speed or high-speed electric two-wheeler, it doesn’t matter as it is replacing a polluting vehicle, he added.

“So that is where the mistake is, that is why it is not working right now and that’s where we hope that this policy would be rejigged to make it a more effective policy,” Munjal said.

In 2019, the government had notified the second phase of the FAME India scheme with a Rs 10,000-crore outlay to encourage the adoption of electric and hybrid vehicles. The first phase of the policy was initiated in 2015.