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India seeks Tesla’s manufacturing plan before reviewing import duty: Report

India seeks Tesla's manufacturing plan before reviewing import duty: Report


India seeks Tesla’s manufacturing plan before reviewing import duty: Report

Following Tesla CEO Elon Musk’s call for import duty cuts on electric vehicles in India, the Centre has reportedly sought detailed manufacturing plans from the electric carmaker. Along with its production plan, India has also asked Tesla to ramp up its local procurement, Bloomberg reported quoting people who are aware of the development.
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The report said that the ministries of heavy industries and finance have sought the details from Tesla in a meeting earlier this month. At the meeting, the EV maker also claimed it has procured components worth $100 million so far from India and suggested that figure would increase following any tax concessions

At present, cars imported as completely built units (CBUs) attract customs duty ranging from 60 per cent to 100 per cent, depending on engine size and cost, insurance and freight (CIF) value less or above USD 40,000.

According to a Reuters report, the government is exploring the possibility of slashing the tax rate to 40 percent from 60 percent presently for imported electric vehicles (EVs) with a value of less than $40,000 (roughly Rs. 29. 7 lakhs) – including the car’s cost, insurance and freight.

For EVs valued at more than $40,000 (roughly Rs. 29. 7 lakhs), it is looking at cutting the rate to 60 percent from 100 percent, the news agency reported quoting senior government officials.

Recently, Union Minister Nitin Gadkari had said Tesla has a golden opportunity to set up its manufacturing facility in India given the country’s thrust on e-vehicles. Tesla is already sourcing various auto components from Indian automakers and setting up base here would be economically viable for it, the road transport and highways minister had said.

Also Read: Pragmatism prevails with the withdrawal of retrospective tax

Gadkari had also exuded confidence that given the improvement in Indian products, within two years India would be capable of producing e-vehicles of Tesla’s standard. He had also said Tesla can make industrial clusters and create and develop its own vendors here.

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