Tesla in India: Tesla Executive Met Indian Govt Officials, Proposes Local Manufacturing, Avail PLI

NEW DELHI: After shelving India debut plan in 2022, electric vehicle giant, Texas-based Tesla had a discussion with Indian govt officials regarding import taxes on cars, setting up a new factory, and many more ahead of PM Modi’s US visit,

According to the source, Tesla proposed establishing a factory in India for the production of electric vehicles (EVs) and investigated plans for local manufacturing of EV batteries.

This development comes after prior talks between Tesla and India were shelved last year, mostly owing to the carmaker's request to decrease the import duty on automobiles, which may reach up to 100%. While India insisted on indigenous vehicle manufacture, Tesla attempted to test the market with imports at first.

Tesla executives further engaged in discussion on how to avail Production Linked Incentive (PLI) scheme.

According to reports, while Tesla did not propose lowering import tariffs with officials in its most recent meeting, it did suggest creating a factory, without providing information on either the location or the investment. There was discussion on which models may potentially be supplied in India, as well as the possibility of establishing a battery manufacturing site in the future.

Late last year, it was focused on lowering import taxes on autos, which can be as high as 100%, and talks with the Indian government broke down.

In 2022, India became the third largest automobile market beating Japan and Germany in terms of sales as per reports.

According to the Economic Survey 2022-23, India's electric vehicle (EV) market is predicted to reach one crore unit annual sales by 2030 and create 5 crore direct and indirect jobs. According to industry projections, overall EV sales in India in 2022 will be around 10 lakh units.

As per The survey tabled in Parliament, "The automotive industry is expected to play a critical role in the transition towards green energy. The domestic electric vehicles (EV) market is expected to grow at a compound annual growth rate (CAGR) of 49 percent between 2022 and 2030 and is expected to hit one crore units of annual sales by 2030."

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