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7 Nov, 2023 08:20

India fast-tracking Elon Musk’s Tesla investment – media

The government is trying to clear the company’s proposal to set up EV manufacturing in the country by 2024
India fast-tracking Elon Musk’s Tesla investment – media

Elon Musk’s Tesla could set up its first electric vehicle (EV) manufacturing facility in India as early as next year, as New Delhi is racing to provide all required approvals by January 2024, the Economic Times reported on Tuesday.

Prime Minister Narendra Modi’s office held a meeting with top officials on Monday to discuss Tesla manufacturing in India, ET reported, citing sources familiar with the matter. 

According to an unnamed official, “fast-tracking approvals by January 2024 to Tesla’s proposed investment in the country was spelt out” during the meeting. A second official said that ministries and government departments have been asked to “iron out any differences” with Tesla and pave the way for the EV giant’s move.

Senior Tesla executives have also met government representatives to discuss plans to set up car and battery manufacturing facilities in the country, the newspaper reported.

According to Reuters, the Indian government is considering reducing import duties on foreign electric cars if automakers commit to making more investments in the country. Transport Minister Piyush Goyal has said that a new policy in this regard could be formulated after discussions with all stakeholders.

Tesla has already made significant inroads in neighboring China despite stiff competition from homegrown EV manufacturers. The US automaker delivered 72,115 China-made vehicles in October alone, according to figures from the China Passenger Car Association (CPCA).

In India, however, Tesla is facing high import duties on EVs and the government’s insistence on promoting local manufacturing. ET noted that Tesla had earlier sought a 40% import duty on fully assembled electric cars against the current rate of 60% applicable on vehicles priced below $40,000, and 100% on those retailed above that. 

In 2021, Musk took to X (then Twitter) to state he was hoping for “temporary tariff relief for electric vehicles” and that he wanted to sell cars in India soon, but its import duties “are the highest in the world.

Earlier this month, media reports suggested that India is planning to cut duties on electric vehicles to a range of 15-30%, specifically for vehicles priced between $25,000 and $35,000. New Delhi’s push to promote EV sales comes amid coordinated decarbonization efforts across sectors, as it has set a net zero emissions target for 2070.

Musk met with Modi during the prime minister’s visit to the US in June this year. The tech billionaire described himself as a “fan” of the Indian leader. Speaking to journalists, Musk said that he was “incredibly excited” about the future of India. “[Modi] really cares about India as he’s pushing us to make significant investments,” he said.  

Musk has also revealed plans to bring Starlink, a broadband internet service developed by SpaceX, to the country.