Indian Government Rejects Tesla’s Request To Decrease Import Duties On Electric Vehicles

Tesla was planning on testing the waters with suitably priced electric vehicles, before setting up an EV factory in India

Tesla’s recent request to the government of India to reduce tax on the import of electric vehicles has been met by stiff opposition. Krishan Pal Gurjar, a junior minister in the BJP-led government said in the Parliament, “No such proposal is under consideration in the Ministry of Heavy Industries.”

Within the last one year, Tesla has officially registered itself in India and also set up an office here. The premium EV-maker is expected to l enter the Indian market by the end of 2021 with the Model 3. It will be brought in as a CBU (completely built-up) unit and under the current import tax laws, it will be taxed 100 percent. The American EV-maker had requested the government to put the EV in the lower 40 percent tax bracket, so that its vehicles could be competitively priced in India and consequently, more widely adopted. Its request was backed up by Hyundai.

Also Read: Hyundai Joins Tesla In An Appeal For Lower Import Duties On Electric Vehicles

Elon Musk had previously revealed that following the  successful debut of Tesla vehicles, the next logical step would be to set up a gigafactory (battery and vehicle manufacturing unit) in India. This would further help reduce the cost of its vehicles here. 

However, with the government’s latest stance on the reduction in import duty, Tesla could choose to alter its point of view. While the American EV-maker hasn’t said anything about this latest development, it could alter its timelines to enter the Indian market.

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