Tesla’s entry to Indian market getting delayed, Here’s why

Last month, Elon Musk deplored India’s restrictive policies on Twitter stating, “While Tesla Inc. wanted to make cars there, import duties are the highest in the world by far of any large country.”

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Last month, Elon Musk deplored India’s restrictive policies on Twitter stating, “While Tesla Inc. wanted to make cars there, import duties are the highest in the world by far of any large country.”

Clean energy vehicles were treated the same as diesel or petrol ones, he added. This remark received a befitting reply by the Hyundai Motor Co. iterating, “cutting duties on imports of electric vehicles would help reach some economy of scale in this very price competitive segment.” However, Musk tweeted of being still hopeful, that tariff will be waived off soon by the government on a temporal basis.

The tax structure displayed the following challenges:

·         Import duties on EVs will remain the same

·         No duty reduction relief for Tesla will have to contribute as per the current rate of 60-100 per cent

·         Implied tax charges on import of vehicles with prices above $40,000

Concurrently, the Modi Government is initiating massive steps in order to decarbonize transport and electrification, on the verge to pursue even extensive Make in India ambitions. The government has targeted 30% EV perspicacity by 2030, raised from the current bars of 10%. Individually, the states implemented several green policies to focus on the same agenda.

However, these policies landed on a stark note as they couldn’t match with the average Indian household income that is comparatively very low to yield benefits from the conventional automobile sectors.

Hence India exigently needs to develop a comprehensive model on auto parts, infrastructure and consumer incentives for electrics and hybrids. The process could incorporate manufacturing batteries for smaller vehicles; swapping stations to enable coherency and extensive subsidies for car buyers in an exceedingly highly price-sensitive market ambience.