India is on the verge of finalizing a deal with American electric car manufacturer Tesla Inc., permitting the sale of electric vehicles (EVs) in the country starting next year. Additionally, plans include the establishment of an electric vehicle manufacturing facility within India’s borders over the next two years.
Reports sourced from reliable channels suggest that an imminent agreement between India and Tesla is poised for announcement during the Vibrant Gujarat Global Summit scheduled for next year in Gujarat. Discussions have indicated the potential establishment of a Tesla production plant in Gujarat, as well as consideration for sites in Maharashtra and Tamil Nadu, owing to their conducive environments for electric car ecosystems and exports.
As part of the proposed deal, Tesla is expected to initiate an initial investment of approximately $2 billion to construct the manufacturing plant in India, with prospects of scaling up auto parts procurement from India to a staggering $15 billion. Moreover, plans include local battery production within the country to optimize costs.
While these details hint at substantial strides towards collaboration, it’s important to note that final agreements are yet to be reached between India and Tesla. Elon Musk, CEO of Tesla, had previously expressed intentions to make significant investments in India, with a prospective visit slated for 2024.
Key representatives from India’s Ministry of Heavy Industry, Ministry of Finance, Ministry of Commerce and Industry, alongside Tesla, have refrained from making official statements on the matter, highlighting the delicacy of ongoing negotiations.
Presently, Tesla refrains from direct car sales in India due to steep import duties. However, insights from sources suggest that local production in India could potentially drive down the retail cost of Tesla vehicles to as low as $20,000.
This reported development signifies a potential breakthrough in India’s EV landscape, pending finalization of negotiations and confirmation from involved stakeholders, heralding a substantial shift in Tesla’s presence and operations within the Indian market.