Tesla is potentially looking for a local partner to set up its operations in India. The American electric vehicle giant is mulling the prospect of a joint venture with Reliance to set up a manufacturing facility in the country, The Hindu Businessline reported on the 9th.
Tesla has reportedly earmarked $2 billion for its upcoming activities in India and is looking at various locations, including Gujarat and Maharashtra, as potential locations for the plant. Maharashtra is reportedly emerging as the popular choice, the report claims.
During a session of X (formerly Twitter) Spaces along with Nicolai Tangen, CEO of Norges Bank Investment Management, Elon Musk, CEO of Tesla, confirmed Tesla’s entry into India. “India is now the most populous country in the world. India should have electric cars like every other country has electric cars. Providing Tesla electric cars in India is a natural progression,” he said.
Tesla executives are expected to visit India within the next month to finalize the location of the plant and cement the joint venture with RIL. However, since the talks with RIL are not exclusive, Tesla may look for another domestic partner if the ongoing talks fail to materialize, the report said.
In early March, the Indian government approved an electric vehicle (EV) policy aimed at promoting the country as a global manufacturing hub for EVs. The policy mandated a minimum investment of Rs 4,150 crore with no maximum investment cap to attract investment from renowned global EV manufacturers.
In addition to a minimum investment requirement of 4,150 crore rupees ($500 million), the policy set a three-year timeline for setting up manufacturing facilities in India, starting commercial production of electric cars and achieving 50% domestic value addition (DVA) within five years. years at most.
The policy stated that the duty on the total number of EVs allowed for import would be limited to the investment made or Rs 6,484 crore (the equivalent of incentives under the PLI scheme), whichever is lower.
In addition, he said a maximum of 40,000 EVs will be allowed with an annual limit of no more than 8,000 vehicles if the investment reaches $800 million or more. Unused annual import quotas could be carried over.
