Despite announcing its India entry and registering the company in Bengaluru in January this year, high import duties and an irrational policy are delaying Tesla's launch in the country, said company CEO Elon Musk. The techpreneur-turned-billionaire's statement came in response to YouTuber Madan Gowri's tweet requesting Musk to launch Tesla cars in India 'asap'.
"We want to do so, but import duties are the highest in the world by far of any large country! Moreover, clean energy vehicles are treated the same as diesel or petrol, which does not seem entirely consistent with the climate goals of India," Musk tweeted in reply to Gowri. "But we are hopeful that there will be at least a temporary tariff relief for electric vehicles," Musk added.
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.
Meanwhile, according to a Reuters report, Tesla may look to set up a factory in India if successful with imported vehicles after the company wrote to Indian ministries seeking a big reduction in import duties on electric vehicles.
However, the Narendra Modi government, which has imposed high import taxes for many industries in a bid to boost local manufacturing, is unlikely to consider Musk's request.
Many luxury vehicles have also lobbied the government in the past to lower taxes on imported cars but have had little success due to opposition from rivals with domestic operations.
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Tesla, which aims to begin sales in India this year, said in a letter to ministries and the country's leading think-tank Niti Aayog that slashing federal taxes on imports of fully assembled electric cars to 40 per cent would be more appropriate, the report said citing sources. That compares with current rates of 60 per cent for cars priced below $40,000 and 100 per cent for those above $40,000.
