The central government has sought electric carmaker Tesla’s detailed plans for investment in India and is reportedly gearing up to offer the company a partial relief from customs duty.
The concerned ministries are apparently hearing out Tesla’s demand for cutting down import duty but a decisive call could only be taken upon receiving the company’s investment plans.
“We can offer some relief... but we need to know what their plans are,” a government official in the know of developments was quoted in a report by the Economic Times (ET).
Tesla desires its cars to be considered as electric vehicles (EVs) and not luxury cars as such. Hence, it is pursuing a 40 per cent import duty on fully assembled EVs in contrast to the current rate of 60 per cent.
The 60 per cent rate presently applies to cars priced below $40,000 and it climbs up to 100 per cent for the vehicles that cross that cost price.
Executives from Tesla have held meetings with senior government officials over this matter and ET had previously reported that the government would be willing to reduce import duty on EVs if the Elon Musk-led company gives assurance over kicking off manufacturing in India.