Govt wants Tesla to first start production in India before any tax concessions can be considered: Sources
They said that the government is not granting such concessions to any auto company and that giving tariff benefits to Tesla will not send a good signal to other companies that have invested billions of dollars in India.
Tesla has demanded a reduction in import tariffs on electric vehicles (EVs) in India.
Currently, imported cars as fully built units (CBU) attract customs duties ranging from 60% to 100%, depending on the size and cost of the engine, the value of insurance and freight (CIF) is lower or more than $ 40,000.
In a letter to the Ministry of Roads, the US company had stated that the effective import duty of 110 per cent for vehicles with a customs value of more than US $ 40,000 is “prohibitive” for no emission vehicles.
He has asked the government to standardize the tariff on electric cars at 40 percent, regardless of customs value, and to remove the 10 percent welfare surcharge on electric cars.
He stated that these changes would drive the development of India’s electric vehicle ecosystem and that the company will make significant direct investments in sales, service and charging infrastructure; and significantly increase acquisitions from India for its global operations.
The company has argued that these proposals would not have any negative impact on the Indian auto market as they do not Indian OEM currently produces a car (EV or ICE) with a factory price above $ 40,000 and only 1-2 percent of cars sold in India (EV or ICE) have a factory / customs value greater than $ 40,000 .
Union Minister Nitin gadkari He had said that Tesla has a golden opportunity to establish its manufacturing plant in India given the country’s push for electric vehicles.
Tesla is already acquiring various auto components from Indian automakers and establishing a base here would be economically viable for this, the highway and highways minister said.