Tesla Ponders Battery Factory in India: Report

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Tesla is reportedly considering building a battery factory in India. The company is again probing the financial environment for a possible entry into the country's market.

Tesla reportedly held talks with Indian officials this week. The company has already offered to open an electric car factory in the country, and plans to produce batteries for electric cars are being discussed, according to an unnamed source. For now, the manufacturer is trying to test the ground to see if it should enter the Indian market.

Tesla is “still testing the waters and trying to understand the local policies,” said the source, who declined to be named as the talks were private, Asia Financial reported.

According to a person with knowledge of the matter, recent talks focused on India's taxes on imported cars. However, they mostly concentrated on how Tesla could use a government scheme to enter the market, the source said.

India has earmarked about $6 billion in two programs to boost sales and production of electric cars in the country. Under the schemes, automakers and battery makers can receive some incentives for selling and exporting locally made cars and parts. If Tesla can take advantage of them, it could change the relationship between the company and the country in a positive direction.

“It appears Tesla has come with a different heart and head this time to take advantage of the auto boom [in India]... Tesla can negotiate on things like taxes better if it first sets up a plant,” said Mohan Shukla of New Delhi-based public policy advisory, White Dolphin Media.

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