PMO bats for Tesla factory in India at the earliest, clearances to be fast-tracked by January 2024

India is abuzz with anticipation as the Indian government reportedly is pushing to fast-track approvals for Elon Musk’s electric vehicle (EV) giant, Tesla, to make its much-anticipated entry into the country. According to an exclusive report by the Economic Times (ET), a recent meeting at the Prime Minister’s Office (PMO) was convened to take stock of the electric vehicle manufacturing landscape in India, with a specific focus on ‘Tesla’s investment proposal.’ The meeting held at the PMO primarily centred around broad policy discussions concerning the burgeoning EV manufacturing sector in India. High-ranking government officials, sources revealed, also underscored the urgency of accelerating approvals for Tesla’s proposed investment in the country. The idea of Elon Musk’s Tesla setting up shop in India has been circulating for some time, gaining substantial momentum following a pivotal meeting between Tesla’s CEO Elon Musk and India’s Prime Minister, Narendra Modi, during PM Modi’s visit to the United States in June 2023. Multiple reports citing government sources have since indicated that discussions between Tesla representatives and Indian government officials have been ongoing, particularly in regards to the establishment of battery and manufacturing facilities within the country. The ET report further disclosed that government officials have been instructed to resolve any outstanding issues with Tesla, paving the way for the prompt announcement of Tesla’s manufacturing plans in India. One of the significant points of contention in Tesla’s India plans has been the import duty structure. Tesla had reportedly proposed a 40 per cent import duty for fully assembled cars—a request that has been subject to scrutiny. Furthermore, Tesla has expressed interest in selling its EVs in India once its manufacturing unit is established. Notably, the current tax regulations in India do not differentiate between electric vehicles and traditional internal combustion engine vehicles. Tesla’s plea has been to classify their vehicles as EVs rather than luxury cars—a move that could have a substantial impact on their pricing and market presence in India. The nation now eagerly awaits further developments as the Indian government appears to be actively working to facilitate Tesla’s entry into the burgeoning Indian EV market, with the potential for Elon Musk’s company to commence operations in India by January 2024.