Know what is the In thing now

India Eases Import Taxes for EVs, Welcomes Tesla’s Proposed Manufacturing Investment

Tesla investment in India

In a bid to strengthen the EV (electric vehicle) sector of India, the government of India has recently scrapped import tariff on some specific types of EVs as long as the manufacturers make expenditure of a minimum of USD 500 million and manufacture locally within the next three years. This is just part of India’s plan that supports creating the local value chains and produces less imports.

Tesla’s plans for India

Mr. Elon Musk, the Founder and CEO of Tesla has been also intending of entering the Indian market for quite a few years, but this required a commitment to make the products locally, which the government wanted. Now, the changed import duty policy opens up an avenue for the company to scale up substantially in India.

As per press, Tesla has sent a team to India to work out a solution concerning the possible location of the planned plant for electric vehicles, which is expected to cost $2-$3 billion. The key attention is on states like Maharashtra, Gujarat, and Tamil Nadu—states that have special automotive industries and offer the wonderful infrastructure and resources to attract manufacturing operations.

The prospect of Tesla coming to India can shake things up in a disrupting world where the overall global electric vehicle demand is falling and the competition is quite aggressive in the dominant markets like the US and China. The last period performance of the company showcased a decrease in first-quarter delivery, as well as failing the expected market deliveries. Yet, India being the main target market, Tesla has plans to utilize a growing demography and to diversify its production foundation.

Its been in the process

Although the negotiations have been ongoing for more than a year between the Indian government officials and Tesla, it still has not been determined. Indian prime minister Narendra Modi had a meeting with Elon musk in June last year. Tesla plans to set up an Indian factory for the manufacturing of an entry-level EV, which is likely to be priced at around $24,000. Also, the firm actively supported the laws preferably enacted on the expensive models destined for sale and use in India.

It is expected that the interest evinced by the giant automaker, Tesla, might trigger more investments and growth avenues for investments in the sector. Also, local auto parts suppliers will benefit too. Analysts point out to a set of wake-up effects because of a rise in competition and innovation which will, in turn, help build and bring about more growth and sustainability.

You might also be interested in

Get the word out!