American car manufacturer, Tesla, is in serious negotiations with the Indian government over its entry into India. India is a very large market and all levels of purchases (high-end, mid-range and entry-level) are significant. However, the Indian government is leveraging on the significance of its market. The government will not allow any Tesla electric car that is not “Made In India” to have the same privilege as a Made In India car. The Indian government recently made it clear once again. Tesla wants to enjoy any preferential import tariffs on the premise of Made In China cars. Tesla cars produced in China and then imported into India cannot enjoy tax concessions.
According to reports, the Indian government told Congress recently (February 8) that it is impossible to “take India as the market, but place jobs in China”. The Indian government told the lower house of the Indian Parliament that Tesla has not yet applied in accordance with the relevant policies formulated by the government. This is why Tesla cannot currently enjoy any concessions.
Tesla is trying to lobby the Indian government
Just as the Indian government speaks out again, Tesla is lobbying New Delhi on plans to cut taxes on its products. Tesla believes that Indian consumers will not be able to afford its electric car products. However, this may not be entirely true. If Tesla believes that Indian consumers can not afford its electric car products, why lobby to enter the Indian market? Just last month, Tesla CEO, Elon Musk said his company was working to overcome “many challenges” to make its debut in India.
Tesla wants to enter the Indian market, but does not want to produce locally. On the other hand, the company plans to produce several models at its Gigafactory in Shanghai, China. Regarding why the Indian government is ambiguous on the issue of providing tax cuts, Mohit Yadav, co-founder of electric vehicle infrastructure company BOLT, said in an interview with reporters earlier that the Indian government must provide subsidies for local electric vehicle manufacturers.
In fact, before this, there was a boom in “Made in India” activities in India. Furthermore, during the new coronavirus pandemic, the entire India witnessed heavy reliance on Chinese manufacturers.
Nevertheelss, the Indian government will most likely not bow to any pressure. The government has always insisted on Made In India products. Many smartphones and other technologies are now Made In India, at least for the Indian market.