Tesla won’t get special treatment in India, government encourages participation in existing schemes

India has been witnessing a surge in interest and demand for electric vehicles (EVs). As Tesla sets its sights on the Indian market, the government will not resort to creating separate policies for individual companies.

While there were initial speculations that the Indian government might introduce tailored incentives for Tesla, officials have clarified that the company can take advantage of measures already in place. The government has launched production-linked incentive schemes for advanced chemistry cell (ACC) battery storage and the automotive sector, leading to significant investments.

Tesla has been encouraged to participate in these existing schemes to foster its growth in the Indian market.

“We have told Tesla that the policies, which are already there for all, they can also apply under that PLI. Generally, the policy will be the same for all. For a single company, the government may not like to make separate policies. So far there is no plan to give special treatment,” a government official told The Times of India.

During discussions, representatives of Panasonic, Tesla’s key battery supplier, expressed their intention to manufacture batteries in India. They were suggested to utilize the PLI ACC battery scheme, aimed at boosting indigenous battery production and reducing the country’s dependence on imports.

In 2021, Tesla’s CEO, Elon Musk, appealed for a reduction in import duties on EVs in India. Currently, imported vehicles face considerable customs duty, making it a challenging market for foreign manufacturers. Those discussions eventually reached a stalemate, with neither side willing to make a concession for over a year.

That changed with talks resuming earlier this year, and Elon Musk’s recent meeting with Prime Minister Narendra Modi demonstrated Tesla’s interest in establishing a presence in India.

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