Tesla seeks relief on import duties until factory is built in India

Currently, there is 60% customs duty in India on the imports of fully-built electric cars.

The Dollar Business Bureau 

American electric car maker Tesla Inc is in talks with the Government of India for seeking relief in import duties till the company builds a local factory in the country, according to Chief Executive Elon Musk.

Musk had stated earlier, this year, hoping that Tesla’s products would enter Indian market this summer, which so far has not materialised.

“In discussion with the government of India requesting temporary relief from import penalties/restrictions until a local factory is built,” Musk said in a tweet.

Currently, there is 60% customs duty in India on the imports of fully-built electric cars, which are priced below $40,000. If the car is assembled in the country, the customs duty is just 10% on completely knocked down cars.

If the value of electric cars imported is more than $40,000 then there is 100% customs duty.

In April 2016, Tesla had said that it planned to foray into the Indian market with Model 3 in 2017, rolling out the vehicle globally late last year.

Model 3 is the company’s most affordable car so far and reaches 215 miles of range on a single charge and costs start at $35,000 before incentives. Model X and Model S are other models from the company.

Of late, Musk has been showing a keen interest in the Indian market and earlier this month had tweeted about the country’s commitment for selling only electric cars by 2030.

“It is already the largest market for solar power,” he had tweeted.

Electric vehicle sales in India increased by 37.5% to 22,000 units in the year ended March 31 2016, as per the Society of Manufacturers of Electric Vehicles. Out of these, just 2,000 units were four-wheelers.

The Dollar Business Bureau - Jun 17, 2017 12:00 IST
 
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