Elon Musk pushes India envelope, to meet Union Minister Piyush Goyal to discuss Tesla manufacturing, EV policy

In a significant development, Tesla’s CEO Elon Musk is slated to meet with India’s Minister of Commerce and Industry, Piyush Goyal, as reported by Reuters. This crucial meeting is expected to take place in the United States next week. Notably, earlier this year, Musk engaged in discussions with Indian Prime Minister Narendra Modi, expressing a keen interest in making substantial investments in the country. The forthcoming meeting between Musk and Minister Goyal is anticipated to revolve around Tesla’s ambitious plans to establish a manufacturing facility in India. Tesla’s objective is to produce an affordable $24,000 electric car while sourcing a significant portion of its components within the country. Additionally, the American automaker is keen on setting up a widespread network of charging infrastructure across India. The report also suggests that the discussions may encompass India’s proposed new policy, aiming to reduce import taxes on fully assembled electric vehicles (EVs) from 100 per cent to 15 per cent. It’s worth noting that this policy is currently in the developmental stages. In 2021, Tesla halted its efforts to enter the Indian market due to inconclusive negotiations with the Indian government concerning import duties. The government’s insistence on local manufacturing and associated incentives played a pivotal role in these talks. Furthermore, Tesla was encouraged to explore India’s production-linked incentive scheme. In a recent development, Prime Minister Modi’s office convened a meeting involving various ministries to expedite the implementation of the new EV policy. The government is closely evaluating the potential impact of this policy on the Indian EV market. Local manufacturers have expressed concerns that lower import taxes on EVs could disrupt the market and impede their plans. While the meeting’s primary focus will be on broader policy matters, an insider disclosed to ET that expediting approvals for Tesla’s proposed investments in India by January 2024 is a significant agenda item. Furthermore, recent reports from Moneycontrol reveal that Tesla is considering commencing its operations in India by importing vehicles directly from its Gigafactory in Germany. This decision comes after Indian officials discouraged importing from Tesla’s Shanghai Gigafactory in China.