Photo: Christie Hemm Klok
India continues to woo Tesla and tries to win its trust by offering lower manufacturing costs than China. Union transport minister Nitin Gadkari said New Delhi is willing to offer incentives that will ensure that manufacturing costs in India are less than in China if Tesla commits to building its electric vehicles there.
The minister's proposal came a few weeks after Tesla registered a company in India. According to industry sources, Tesla intends to begin its first deliveries to India by mid-2021. Companies that do not have either a production plant or a platform for assembly provide cars to the customers only Completely Built-Up (CBU), which is reflected in higher duties. However, Tesla having its own manufacturing facility in India could make a significant difference.
"Rather than assembling (the cars) in India, they should make the entire product in the country by hiring local vendors. Then we can give higher concessions," Gadkari said in an interview, without giving details of what incentives would be on offer, reported Live Mint.
"The government will make sure the production cost for Tesla will be the lowest when compared with the world, even China, when they start manufacturing their cars in India. We will assure that," he said.
India is seeking to stimulate local production of electric vehicles, batteries, and other components to cut costly imports and reduce pollution in its major cities, in line with global targets to reduce carbon emissions.
"I think it's a win-win situation for Tesla," Gadkari said, adding he also wanted to engage with Tesla about building a hyperloop between Delhi and Mumbai
At the moment, India is developing a manufacturing-related incentive scheme for car and auto component manufacturers and for the creation of advanced battery manufacturing facilities, but the details have yet to be determined. Shifting to cleaner energy sources and reducing vehicle pollution are considered essential for India to meet its climate commitments under the Paris Agreement.
"Development and environment will go hand in hand. We will take some time but we will soon reach the international standard norms," said Gadkari.
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About the Author
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.