Tesla planning manufacturing facility in India; however, demands imports credit till production starts

Tesla, the world’s largest startup in manufacturing electric cars, is again sending positive signals for an imminent entry into India’s vast untapped electric mobility industry. The company has told the government about its intentions to manufacture their electric vehicles in the country, however, demanding temporary relief on import curbs and penalties until a local factory is built. Tesla is particularly excited about the country’s ambitious aim of running all electric fleet by 2030.

However, to get to the point of getting the concessions, it must go through a labyrinth of approvals from Department of Industrial Policy & Promotion (DIPP) and the Ministry of Heavy Industries & Public Enterprises. The concessions sought by the company may include a reduction in stipulated import duties or a waiver of local sourcing requirements in the event the company decides to set up single-brand retail stores in the country.

Sugato Sen, deputy director general at the Society of Indian Automobile Manufacturers (SIAM) commented that “Manufacturers usually import and sell vehicles by appointing a local distributor. Import duties as stipulated by the government are levied on such vehicles. In the event Tesla decides to set up its own stores, single-brand retail norms will become applicable”.