Global electric vehicle (EV) giant Tesla on Wednesday is revisiting its plans to set up a factory in India, for both domestic and exports and it has not asked the Indian government to also consider a duty cut, sources privy to the development said.
A senior leadership team from Tesla has met the top government officials here, but the company did not discuss lowering import tax on electric cars, the sources said.
“They had approached for a meeting, and it was largely around meeting of the Prime Minister Narendra Modi’s visit to the US next month, in which Tesla founder Elon Musk is also likely to meet him,” a senior government official told businessline.
The Prime Minister will go to the US on a State visit on June 22 following an invitation from President Joe Biden and First Lady Jill Biden. The US President and the First Lady will also host PM Modi to a state dinner.
The US and India last month announced an initiative on critical and emerging technology, a plan to share advanced defence and computing technology, including the joint production of General Electric jet engines.
The Indian government has not accepted Tesla’s earlier proposal of seeking duty cuts, to promote domestic manufacturing. “Now, we do not know whether they are coming with the same proposal or bringing another proposal,” the official said.
Last year, Musk had said that the company, which was earlier seeking a reduction in import duties to sell its EVs in India, would not manufacture its products unless it is allowed to first sell and service its cars in the country. The company, which also accepted pre-bookings from customers in India for its Model 3 in 2016, with a booking amount of $1,000, had to drop the plan because India has the highest import duties in the world.
Currently, India imposes 100 per cent import duty on fully imported cars with CIF (Cost, Insurance and Freight) value more than $40,000 and 70 per cent on those costing less than the amount.
Road Transport and Highways Minister Nitin Gadkari had also said that if Tesla was ready to manufacture its EVs in India, there was ‘no problem’, but the company must not import cars from China.