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Tesla entered the next phase of development in India and began negotiations with the government to create fully owned retail outlets. According to the foreign direct investment (FDI) policy of the country, the company and its intentions will be thoroughly checked before they can invest in their development.
Tesla intends to build its own retail outlets in India to sell vehicles and provide services. According to the Indian publication Business Standard, the American manufacturer has begun negotiations with the government on how to create its fully-owned retail outlets. A company must comply with foreign direct investment (FDI) directives related to mono-brand retailing, including local sourcing regulations, to sell directly in India.
In 2020, the Indian government amended its FDI policy and required foreigners to obtain government approval before investing in Indian businesses. Now proposals for foreign direct investment by the government are reviewed by the relevant administrative ministry/department, after which an appropriate decision is made.
Tesla has already taken many important steps to enter the Indian market, including asking the government to reduce taxes on imported electric vehicles. Several government ministries have backed Tesla's proposal to reduce import duties on Completely Built-up Units (CBUs), subject to certain conditions. Volkswagen, which also makes electric vehicles, has sided with Tesla on the matter. At the moment, the final decision remains with the Ministry of Finance.
At the end of August, Tesla passed the homologation phase for its four models/variants of the vehicles for which it was seeking approval in India. Homologation is a process that confirms that a vehicle is fit for use and meets all the required criteria. This step is necessary to set the stage for the launch of sales there. Without approval from local agencies, vehicle access to the country's roads would have been impossible. This was another important milestone to launch Tesla car sales in India.
© 2021, Eva Fox | Tesmanian. All rights reserved.
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Article edited by @SmokeyShorts, you can follow him on Twitter
About the Author
Eva Fox
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.
