While Tesla executives met with Indian officials also inquired about details of possible incentives and tax breaks to the company and its partners for setting up a manufacturing unit in India.
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New Delhi: American car manufacturing giant Tesla Motors is in talks with the government of India about bringing its own auto parts and electronics supply chain to India, according to a report on the Economic Times. It says the electric car maker is also seeking clarity on incentives and tax breaks.
The Elon Musk-led company is looking forward to establishing its own supply chain ecosystem in India, while the government has asked the company to evaluate the existing auto components supply chain in the country. Even though the discussions are currently at a nascent stage, there is hope for progress, the sources mentioned in the ET report said.
The company has finally initiated talks with the Indian government regarding an investment proposal to establish a car manufacturing plant in India. As per a report on Firstpost, the proposed factory would have the capability to produce up to 500,000 electric vehicles annually, with prices starting at Rs 20 lakh.
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Musk-Modi Meet
When Elon Musk met Indian prime minister Narendra Modi last month, the expectations were sky high. Following the meeting, there was a lot of buzz around the launch of Tesla and Starlink in the country. Of course, Musk can’t afford to overlook a big market like India.
While Tesla executives met with Indian officials also inquired about details of possible incentives and tax breaks to the company and its partners for setting up a manufacturing unit in India.
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As per a Financial Express report, Tesla had agreed in principle to the Indian government’s proposal to not just assemble its electric vehicles in India, but also to establish a local vendor base.
Tesla officials have also been meeting with Indian industry executives. At a recent meeting of the Society of Indian Automobile Manufacturers (SIAM), Tesla said it wants to bring its own suppliers to India, while SIAM emphasised the availability of mature and established auto players in the country. However, Tesla maintained its preference for a completely in-house approach, citing the need for specific quality standards.
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The dialogue between Tesla and the Indian government indicates a thawing of tensions between the company and the government. The country had previously rejected Tesla’s demand for import duty cuts, leading to the company shelving its plans for an India debut in 2022. However, the recent meeting between Modi and Musk and the government’s proactive approach has reignited expectations for Tesla’s larger plans for India.
