EV Makers Body Petitions NGT For Green Tax On Fuel-Based 2-Wheelers

On Tuesday, the Society of Manufacturers of Electric Vehicles announced that it has filed a case with the National Green Tribunal (NGT) in protest of the government's decision to eliminate the FAME II subsidy and propose a "Green Tax" on two-wheelers that run on petrol. The Society of Manufacturers of Electric Vehicles (SMEV) stated in its petition that the Ministry of Heavy Industries' most recent decision to reduce FAME II subsidies is likely to impede India's growth in the EV sector and consequently have a negative effect on the environmental and health indices of the nation.

It said that the ministry had unexpectedly decided to reduce subsidies by 75%. Additionally, SMEV stated that it has "asked for NGT's support for a green tax on fuel-based two-wheelers in order to encourage the adoption of green vehicles and contribute to the national objective of environmental preservation and pollution reduction."

"Electric vehicles are subsidised across the world with the intent to induce a mass shift towards non-polluting energy systems," SMEV Secretary General Ajay Sharma said.

He further said, "The Ministry's decision is contrary to this consciousness and an anomaly that defies logic or law, especially, as the EV manufacturers were emboldened to shift technologies, work force, capital, and enterprise towards this sector based on the support expressed by the government.

Many OEMs are struggling financially as a result of the ministry's measures because subsidies totaling more than Rs 1,200 crore have been delayed and further claims for retroactive return of subsidies awarded in 2019 have been made, according to SMEV.

"In fact, it is a matter of time until they shut shop due to lack of working capital, a loss of investor and bank support, a delay in production timelines, and a rapidly vanishing distribution network," the statement added.