Rama Krishna Sangem
Very soon, we can buy a Tesla electric vehicle in India, at affordable prices. Tesla, an American automobile driven on electricity, will be available at price, comparable to other Indian made cars. Till now Tasla has been facing problems on selling their cars in India due to heavy import duty that touches 100 per cent of the car cost. Only some people who can pay this exorbitant price would bring them, but not all.
Moreover, as the cars are not sold at market level, Tesla couldn’t set up after sales services here. This has become a major problem all those who want to buy this car, made by Elan Musk, who created ripples a decade ago by going for an EV that suits environmental norms and zero emissions. Tesla, a futurist car has, in fact, spurred the imagination of all auto maker majors, including top notch luxury brands.
Tesla has been pushing for cuts in import duties in India for long. Recently, this push gained momentum as the US Trade Representative and other Biden administration officials lobbied hard for import duty cuts on American goods and cars. The Narendra Modi government has to take them into consideration and offer some import duty cuts. Particularly, on Tesla cars, icons of EVs.
Import duty to be cut by 15 per cent
As per the latest information emanating from the union commerce ministry, the import duty on Tesla cars, priced above 40,000 US dollars can be cut by 15 per cent. At present they attract 100 per cent duty. Those which are priced below 40,000 US dollars are offered lower duty, depending the components of the car. However, Indians show interest to buy EVs only above range of 40,000 US dollars, approximately around Rs 33 lakh.
Tesla now plans to set up a manufacturing unit in India at an investment of around 2 billion US dollars. The company makes cars that are priced at around 95,000 US dollars too. Of course, there are other top brand cars of Rolls Royce which are selling highest priced 4.5 million US dollars – around Rs 35 crore. Other leading auto makers like Porsche too are producing EVs in that range.
Obviously, Indian car makers who produce EVs – Mahendra & Mahendra and Tata Motors are a bit worried over the entry of Tesla into the country. They are keenly watching if Tesla really manufactures its cars in India or just imports auto parts and assembles so as to avail import duty cuts. Government of India is thinking of offering duty cuts for 2-3 years for Tesla and take a call later based on their performance.
