- Sunday, November 24, 2024
By: Shubham Ghosh
THE Narendra Modi government has asked Tesla Inc. to increase local procurement and share manufacturing plans in detail before the automaker giant’s demands for lower taxes on electric vehicles are considered, Bloomberg reported citing informed sources.
India’s ministries of heavy industries and finance sought the details from the US company in a meeting earlier in August even as the government assesses demand from Tesla chief executive Elon Musk to lower taxes on electric vehicles in India, the source added on the condition of anonymity.
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Tesla has also been asked by the government to share its thoughts on importing fully built cars versus knocked-down units or partially-built ones, which attract a lower import levy, the source said, Bloomberg added.
In July, Tesla wrote to the Modi government seeking reduction in import duty on EVs to 40 per cent from the current 60 per cent (for cars priced below $40,000) to cent per cent (for those priced above $40,000).
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The company also wanted the 10 per cent social welfare surcharge, which is levied on all imported cars and helps fund health and education programs, to be scrapped.
The source also added that at the meeting, the California-based carmaker said it has procured components worth $100 million so far from India and suggested that the figure would go up following any tax concessions.
The person also added that Tesla promised to make significant investments in sales, servicing and charging infrastructure and evaluate broader investments in manufacturing once it entered India.
Musk has showed interest to enter the Indian market, the fifth-largest in the world, for a while now but complained that the country’s regulations stopped him from trying the Indian market first with imports, since high duties make cars from his stable “unaffordable”.
