A few months back, Elon Musk, the CEO of Tesla Inc, had tweeted that doing business in India would attract a very amount of import duty and sourcing requirements. However, according to sources now, the company has initiated talks with the Indian government about entering the Indian market through the single brand retail route. The single retail route comes with some mandatory riders like sourcing of up to 30 percent of the value of the goods sold.
The Indian government will reply to Tesla Inc formally and we are expecting it to come in over the next few weeks. The country will be hoping for a positive response as there were signs that hinted about the inevitability of the company in India. Firstly, the Indian buyers have shown interest in the electric performance cars made by Tesla. Secondly, back in 2015, the Prime Minister of India, Narendra Modi, himself had visited the company’s headquarters, which is enough to prove that he wants the ace electric automaker to come to India.
Another possible factor that may support Tesla’s cause is that this proposal has been put forward amid the electric-drive in India with Nitin Gadkari, the transport minister of the country, talks about having nothing but just electric vehicles on the road by 2030. In fact, several automakers like Ford and Maruti have already dug their head into planning for some models in the segment.
Back in mid-June, Elon Musk had tweeted that the company was in talks with the Indian government and was requesting for a temporary relief from import duty until a local plant is set up. However, auto experts and analysts believed that it was not easy to get relieved from the import duties. Moreover, in cases where with the duty is in excess of 100 percent, the import route does not make sense at all.