While the Ministry of New and Renewable Energy (MNRE) subsidy scheme has helped more than double sales of electric cars and two-wheelers over the last year, the industry still awaits refund of about Rs 15-20 crore from the Government.
Government sources said that the Union Heavy Industries Minister, Mr Praful Patel, is expected to write to the Finance Minister, Mr Pranab Mukherjee, asking for timely disbursal of funds and a continuation of the scheme after March this year – at least till the Electric Vehicle Policy is formally announced.
Subsidy scheme
A Rs 95-crore corpus was announced under the MNRE scheme in November, 2010 to be used till March 31, 2012. Under the sop, 20 per cent of the ex-factory price of an electric vehicle would be subsidised (up to a maximum amount), reducing the price gap with conventional petrol/diesel models.
The manufacturer would pass on the benefit to the customer as lower prices, later claiming a refund from the Government.
“About Rs 35 crore of the corpus has been consumed by the industry under the scheme, but half of that amount is yet to be paid back.
There is an issue in disbursal, nobody has got any refunds for the last 6-8 months,” Mr Sohinder Gill, Director of Society of Manufacturers of Electric Vehicles and CEO, Hero Electric, said.
He added that manufacturers have doubled sales under the scheme, largely by eliminating ‘illegal' traders who were importing such vehicles from markets such as China.
Subsidy helps
Dr Pawan Goenka, President (Automotive and Farm Equipment Sectors), Mahindra & Mahindra confirmed the delay in payments.
The only company to make electric cars at home, Mahindra-Reva sells about 30-40 units of the Revai a month.
“I cannot mention the actual amount, but there is a delay in the payments. But, the scheme has helped us and we're hoping it will continue,” he said.