Govt wants Tesla to come to India; Revenue Department yet to decide on duty cut
If Tesla brings its cars to India, there will be an import duty of 110 percent and the carmaker has requested for the duty on electric cars to be reduced to 40 percent.
A day after the secretary, Road Transport and Highways Ministry, took a short ride in the Tesla Model 3, CNBC-TV18 has learnt that the government wants the American electric carmaker to come to India but wants it to commit to local sourcing, investments and manufacturing.
It is also understood that there are inter-ministerial differences on Tesla's request for a duty reduction and a final call is yet to be taken by the Department of Revenue.
Tesla is holding up as it has conveyed to the government its need for duty reduction or else it will not be able to have viable business operations in India.
If Tesla brings its cars to India, there will be an import duty of 110 percent and the carmaker has requested for the duty on electric cars to be reduced to 40 percent. The proposal is pending with the Revenue Department.
There have been consultations between the Ministry of Heavy Industries, the Ministry of Road Transport, NITI Aayog, and the Ministry of Commerce as well. However, there are differences.
The Ministry of Heavy Industries believes that Tesla should manufacture in India before it can be granted any sort of duty concession whereas other ministries are of the view that there should be some sort of interim duty relief given to the Elon Musk company so that it can at least start operations in India and then the Indian government can ask it to start manufacturing or local sourcing as well.
Watch the accompanying video of CNBC-TV18’s Parikshit Luthra for more details.
(Edited by : Kanishka Sarkar)
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