In a recent development, a government official has stated that there are no plans to introduce a separate policy to provide incentives to Tesla, the US-based electric car maker. Instead, the company is encouraged to avail support measures under existing schemes such as the Production-Linked Incentives (PLI) for the auto industry and advanced chemistry cells.
The government has already implemented the PLI schemes for advanced chemistry cell (ACC) battery storage with a budget of Rs 18,100 crore, and a PLI scheme of Rs 26,058 crore for the auto, auto-components, and drone industries.
Regarding the matter, the official mentioned, “We have informed Tesla that the policies already available for all companies can also be applied under the PLI. They are welcome to do so. Generally, the policy will be the same for all. The government may not prefer to create separate policies for a single company. Currently, there are no plans to provide special treatment.”
The government suggests that Tesla’s major battery supplier, Panasonic, can also apply under the PLI for ACC batteries if they intend to manufacture batteries in India.
Recently, the government announced the re-bidding of production-linked incentives for 20 GWh advanced chemistry cell manufacturing. To facilitate this process, the Ministry of Heavy Industries is holding a stakeholder consultation with industry representatives on July 24. The input and suggestions from industry stakeholders will be taken into account before commencing the re-bidding process for the remaining 20 GWh capacity.
Tesla representatives had visited India in the past and met with officials from various ministries, including the Commerce and Industry Ministry. During their visit in 2021, the electric car manufacturer requested a reduction in import duties on EVs. Presently, electric cars are imported as completely built units (CBUs), attracting customs duty ranging from 60 percent to 100 percent, depending on engine size and cost, insurance, and freight (CIF) value, if it is less or above $40,000.
After meeting Prime Minister Narendra Modi in New York last month, Tesla’s CEO, Elon Musk, expressed his plans to visit India in 2024. He stated, “I am confident that Tesla will be in India, and we will do so as soon as humanly possible.” Musk emphasized the possibility of a significant investment and a strong relationship with India.
In conclusion, while the government has no plans for exclusive incentives for Tesla, the company is encouraged to explore the existing schemes and support measures to expand its operations in India. As Tesla considers investment opportunities in the country, it may play a significant role in the growth of the electric vehicle market in India.
