The American electric car maker Tesla is putting efforts to get an import duty relaxation from the government before entering India. Elon Musk’s company has dialed PM Narendra Modi’s office with its request for an import tax cut down on electric cars.
Tesla’s plan is to import its electric cars to India and sell under its banner to make the official debut. But the company is facing a big challenge of figuring out how to deal with the import tax. Since the Indian tax scheme charges 60% import duty on electric cars with $40,000 or less pricing and above-priced vehicles have to pay 100% tax. This would likely affect Tesla sales as the cars will then be tagged at even bulkier prices.
Manuj Khurana, Tesla Head of Policy in India, has held a closed-door meeting with PMO officials last month that didn’t go that well in favor of Tesla. For further effort, sources report that Tesla is looking to organise a meeting with Elon Musk and PM Modi for a better result.
According to a Reuters report, some of the PMO officials need Tesla to make its OEM products locally in the country before asking for foreign tax breaks. Also, the indigenous vehicle manufacturers like Tata Motors and Mahindra are openly opposing the demands of Tesla citing that this would discourage India’s aim of achieving sustainable development in the automobile industry.
Previously, Nitin Gadkari, Minister of Transport, has clearly stated that Tesla should not trade ‘Made in China’ electric cars in India and has expressed his desire urging the US car producer to “make cars in India, sell in India, and export from India.”
Since the announcement of its arrival to the Indian territory, Tesla is proceeding gradually to set its foot in the country. The EV giant has already achieved homologation for its two variants Model 3 and Model Y. Also, the company is looking to set up dealership outlets in metro cities including New Delhi, Mumbai, and Bengaluru to name a few.