Following past disputed, Tesla and India agree to build factory

Robert Besser
21 May 2023, 11:26 GMT+10

Tesla officials have told the Indian government that it would like to set up a factory in India to build electric vehicles for the domestic and export markets
In previous talks held last year, India refused to agree to Tesla's request to lower the import tax on its vehicles
During their current talks, Tesla did not discuss lower import taxes with Indian officials, but proposed setting up a new factory, without specifying a location or level of investment

NEW DELHI, India: Tesla officials have told the Indian government that it would like to set up a factory in India to build electric vehicles for the domestic and export markets.

In previous talks held last year, India refused to agree to Tesla's request to lower the import tax on its vehicles, which can reach as much as 100 percent and were described by Tesla CEO Elon Musk as among the highest in the world, and demanded that Tesla build vehicles locally.

During their current talks, Tesla did not discuss lower import taxes with Indian officials, but proposed setting up a new factory, without specifying a location or level of investment.

As global companies are looking to reduce their supply chain dependence on China, manufacturing autos in India is in line with Indian Prime Minister Narendra Modi's efforts to attract companies with his "Make in India" campaign.

Meanwhile, Reuters reported that senior Tesla executives are in India this week to meet the government to discuss local sourcing of parts and other issues.

Tesla has hired a local team and begun a search for showroom space, but these efforts were stopped last year.

The meeting comes weeks before Modi's visit to the US in June.

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