Amid the report of China freshly creating fresh disturbance at the LAC, Union minister of Road Transport and Highway Nitin Gadkari has said that he has told US-based electric vehicle (EV) manufacturer Tesla not to sell China-manufactured cars in India.
Gadkari further disclosed a conversation he had with asked Elon Musk, the head of Tesla manufacture.
“I have asked Tesla not to sell electric cars in India which the company has manufactured in China. I have told the company to manufacture electric cars in India, and also export cars from India,” the minister said on Friday while addressing an event. Minister said that Tesla should price its vehicles at Rs 35 lakh. He said that under the Aatmanirbhar programme the local production of electric batteries is on the rise and in the near future, India will be in a position to export electric batteries. This will be an added advantage for Tesla in setting up its business in India which is the fifth-largest auto market in the world.
When will Tesla start operations in India? Union Minister Nitin Gadkari (@nitin_gadkari) answers Watch India Today Conclave 21 #ABetterNormal pic.twitter.com/lldnoeitq8
— Rahul Kanwal (@rahulkanwal) October 8, 2021
Minister Nitin Gadkari said that the Narendra Modi government will extend all necessary support to Tesla to set up its unit in India. He informed that the negotiation is going on with Tesla regarding the company’s demand related to tax concessions.
Tesla has been demanding a reduction in import duties in India. Musk had also stated that his plans to bring Electric Vehicles to India were hampered by high import duties charged in the country. “We want to do so, but import duties are the highest in the world by far of any large country!” Musk had tweeted in July.
We want to do so, but import duties are the highest in the world by far of any large country!
— Elon Musk (@elonmusk) July 23, 2021
Moreover, clean energy vehicles are treated the same as diesel or petrol, which does not seem entirely consistent with the climate goals of India.
The Indian government imposes a 100 per cent import duty on cars as completely built units (CBUs) attract customs duty ranging from 60-100 per cent. This depends on engine size and cost, insurance and freight value less or above $40,000. Such high duties are meant to protect domestic manufacturers.
Last month, the heavy industries ministry had conveyed to Tesla any tax concession can be considered once the company starts manufacturing electric vehicles in India. Musk had said that an effective import tariff of 110 per cent on vehicles with customs value above $40,000 was “prohibitive” to zero-emission vehicles. He had further requested the government to rationalize tariffs on electronic vehicles and withdraw the social welfare surcharge levied on them.
