India may cut import taxes for Tesla and other EV makers if they build locally | Business Upturn

India may cut import taxes for Tesla and other EV makers if they build locally

Tesla wants to enter India with lower import taxes for EVs if they make some cars in India. India is considering the policy, but local carmakers are not happy.

Tesla, the world’s most valuable car company, has a big plan to enter India, one of the world’s largest car markets. But there is a catch: India has very high import taxes for cars, especially for those that cost more than $40,000.

That’s why Tesla has proposed a new policy to the Indian government that would lower the import taxes for electric vehicles (EVs) if the automakers agree to some local manufacturing. This would make Tesla’s cars more affordable and attractive to Indian customers, who currently have very few options for EVs.


The Indian government is interested in Tesla’s proposal and is working on a new EV policy that could reduce the import taxes to as low as 15%, compared to the current 100% or 70%, depending on the car’s price. For example, Tesla’s popular Model Y, which costs $47,740 in the U.S., could become much cheaper in India if the policy is adopted.

But this policy could also benefit other global automakers who want to tap into India’s huge potential for EVs, which account for less than 2% of total car sales but are growing fast. India has ambitious goals to reduce its carbon emissions and boost its green energy sector.

However, the policy is not a done deal yet. The Indian government is going to be cautious and slow in considering it, because it could disrupt the market and upset local carmakers like Tata and Mahindra, who are investing heavily to make their own EVs in India. They don’t want to lose their edge to foreign competitors who can offer cheaper and better EVs.

So, will India welcome Tesla and other EV makers with open arms and lower taxes? Or will it protect its domestic industry and keep the taxes high? The answer could shape the future of India’s EV market and its role in the global green economy.