"FAME II is an opportunity for India to prove that our EV technology is truly global and to become a global hub for development of electric vehicles"

In conversation with Sustainability Outlook, Mr. Mahesh Babu, CEO of Mahindra Electric, shares his thoughts on key challenges and opportunities that the automobile industry in India faces under FAME II. 

How do you think FAME II will change the landscape for EVs in India?

Riding on the success of FAME-I, which supported more than 2.5 lakh vehicles with the Rs 895 crore total outlay, the government announced FAME-II with some major modifications. FAME II is a long-term, well thought out policy to promote manufacturing, adoption and acceptance of electric vehicles in India. The outlay of Rs 10,000 crore will boost the overall ecosystem required to ignite the Indian EV industry. The policy aims at reducing India’s ever increasing oil-import bill along with the pollution that comes with its consumption. Under FAME II, we expect the demand in EVs to be driven mainly by fleet-based operators, personal two wheeler segment and other commercial applications. The focus on charging infrastructure is also significant and we expect to see great traction in this space as well.

Source: Mahindra Electric Mobility Limited 

How will the localization rider under FAME II impact EV component manufacturing?

The success of India’s e-Mobility program cannot be achieved without a strong policy on manufacturing. Under FAME II, Ministry of Heavy Industries and Public Enterprises has released a Phased Manufacturing Program (PMP) which will boost local manufacturing of EV components including battery packs, power electronics and electric motors to be made in India for the world. Mahindra has been investing consistently on EV related technologies for over a decade now and we are now ready to make-in-India for the world.  

What are some of the challenges you foresee for EV manufacturers under FAME II?

FAME II is an opportunity for India to prove that our EV technology is truly global and to become a global hub for development of electric vehicles. Currently, FAME II focuses on fleet and public transportation and does not offer any subsidy to personal segment. We would like the inclusion of private vehicles in FAME 2 which would help the overall EV penetration in India. FAME 2 will still ensure India playing a larger role in moving the world to electrics.

What are the key opportunities that can arise from indigenizing EV component manufacturing?

Indigenizing EV components will make electric vehicles more affordable and boost the overall manufacturing, R&D in India. Not all global EVs can be launched directly for tropical conditions like in India. It needs more testing and calibration.   Local sourcing will help us develop supply chain and technology of electric vehicles at affordable pricing.

What steps should both automobile industry and government take to ensure uptake of EVs beyond FAME II?

Higher penetration of electric vehicles in fleet and public transportation will further increase the pace of building charging ecosystem which will translate into faster adoption in the personal segment. With localization and FAME II subsidies in place, we expect the state governments to adopt EV without any permits in public transport.

Source: Mahindra Electric Mobility Limited 

Mahesh Babu is the CEO of Mahindra Electric Mobility Limited. Mahindra Electric currently has five different electric vehicles under both personal and commercial segments with plans to widen the range of EVs even further.