Tesla has been lobbying the government of India to slash its import duties on electric vehicles (EVs) in an effort to expand into the fourth largest auto market in the world.
Tesla wants to sell vehicles imported from Giga Shanghai in order to test the level of demand in the country before committing to domestic manufacturing or spending at least $500 million on the purchase of domestically produced auto parts.
The opposing positions has resulted in a stalemate as the government has said Tesla must first commit to producing vehicles in India before being allowed to import them from another country.
After a few months of relative silence on the matter, India’s transport minister has reiterated the government’s position that Tesla should not import vehicles from Giga Shanghai.
Speaking at a government conference on Tuesday, Nitin Gadkari said it would not be a good deal for India, which is attempting to increase local manufacturing.
“If Elon Musk is ready to manufacture in India then there is no problem. Come to India, start manufacturing, India is a large market they can export from India. But if he wants to manufacture in China and sell in India, then it cannot be a good proposition for India,” Gadkari said.
EVs imported into India are faced with some of the highest import taxes in the world, which can be as much as 100% on EVs with a value higher than $40,000.
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