Soon Tesla in India? Tackle many challenges with central government, says CEO Elon Musk-Technology News, Firstpost

US-based Tesla is working with the government on many challenges to launch its products in India, Elon Musk, the electric car founder and CEO, said Thursday.

In response to a tweet about the company’s plans to launch its products in India, Musk tweeted: “We are still working on many challenges with the government”.

Last year, Tesla had requested a cut in tariffs on electric vehicles (EVs) in India.

The Ministry of Heavy Industry had asked the electric car major to start manufacturing its iconic electric vehicles in India first before tax breaks can be considered.

The government sources had noted that they were not giving such concessions to any car company, and giving Tesla tax breaks will not send a good signal to other companies that have invested billions of dollars in India.

Cars imported as fully built units (CBUs) are currently subject to customs duties ranging from 60 to 100 percent, depending on engine size and cost, insurance and freight (CIF) with a value of less than or more than $40,000.

At present, Tesla can bring in Tesla cars in CKD form without tax and assemble and sell them here. According to government sources, the Center has introduced a PLI scheme for the auto sector, especially EVs, where Tesla will benefit if they produce here.

However, the company wants the government to reduce import duties on cars without any obligation to manufacture in India.

The sources say that with such tweets, Tesla is trying to put pressure on the government using social media, and this is not the first time.

In a letter to the Department of Highways last year, the US company said the effective 110 percent tariff on vehicles with a customs value of more than $40,000 is “banned” on zero-emission vehicles.

The electric car major had asked the government to standardize the tariff for electric cars to 40 percent regardless of customs value, and to withdraw the 10 percent social surcharge on such vehicles.

It had said that these changes would boost the development of the Indian EV ecosystem and that the company will make significant direct investments in sales, service and charging infrastructure; and significantly more sourcing from India for its global operations.

In January 2021, Tesla registered its Indian branch amid indications that the company plans to enter the country’s auto market.

According to a registration application, the company has registered Tesla India Motors and Energy Pvt Ltd with RoC (Registrar Of Companies) Bangalore.

The company is registered as an unlisted private entity with a paid-up capital of Rs 1 lakh.

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