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BUSINESS EYE APRIL 19, 2024 | The Indian Eye 34

How Tesla’s US$ 2 billion-investment in

India could change the EV market

Elon Musk to meet Prime Miniter Modi on April 22; CEO says it will be a natural progression

for his company to provide Tesla electric vehicles in the country

OUR BUREAU
New Delhi/Mumbai

esla chief Elon Musk may unveil India’s in-
vestment plan this month. Confirming his
Tupcoming visit to India, Musk had tweeted
late on Wednesday that he was looking forward to
meeting Prime Minister Narendra Modi. “Looking
forward to meeting with Prime Minister @Naren-
draModi in India!” Musk wrote on X.
Musk’s visit to India where he is likely to an-
nounce investment in the country, comes at a time
when Prime Minister Narendra Modi is bidding for
his third term and may give a fillip to the govern-
ment’s image for attracting big-ticket investment. It
may also boost BJP’s polls prospects given the party
in power at the Centre is aggressively campaigning
with global corporates to invest in India.
Earlier this week in an X Spaces session, Elon
Musk had said that India, like every other country,
should have electric cars and it will be a natural pro-
gression for his company to provide Tesla electric
vehicles in the country.
According to sources, Musk, during his India
visit, might make the much-anticipated announce-
ment of setting up Tesla’s first plant in the country.
Musk will likely meet Prime Minister Modi on April Prime Minister Narendra Modi meets Tesla and SpaceX CEO Elon Musk in New York in June last year (ANI)
22 in the national capital, according to Reuters.
Apart from announcing Tesla’s maiden foray in setting up the manufacturing unit, at least 25 per growth of the country as well as industry, and to
India, Musk is also expected to disclose details of cent of the parts used to make the vehicles should make that happen, one of the important areas is for
the automobile major’s plans for the country. be sourced domestically. This localization level is big-ticket reforms to happen.
It was reported earlier that Tesla officials were expected to increase to 50 per cent by the fifth year The CII President said, “From an industry
exploring potential sites in India for a manufactur- of operation. perspective, let me make four broad points. First
ing plant, which is anticipated to necessitate an in- Under the new EV policy, for vehicles valued at and foremost, we are saying that India should have
vestment of approximately USD 2 billion. USD 35,000 or more, a 15 per cent customs duty will growth and it should be inclusive growth, which is
Tesla’s interest in expanding its presence in the be imposed for five years if the manufacturer builds very important for us, both from an industry per-
Indian market has intensified, with the company ac- manufacturing facilities in India within three years. spective and also from the country’s economic
tively searching for a suitable location to establish a The total number of EVs allowed for import growth perspective.”
cutting-edge manufacturing facility. under the policy will be limited based on the in- He emphasised big-ticket reforms and broad
According to sources, the state governments of vestment made, or of a maximum value of Rs 6484 consensus amongst the centre and the states to
Maharashtra and Gujarat have extended attractive crore, whichever is lower. If the investment exceeds make the sea-change. “To make that happen, there
land offers to Tesla for this purpose, signalling signif- USD 800 million, a maximum of 40,000 EVs can be has to be a broad consensus built amongst the cen-
icant progress in India’s electric mobility landscape. imported, with no more than 8,000 per year. Un- tre and the states. GST structure type of a body will
As reported earlier, initially Tesla would manufac- used import limits can be carried over. help the implementation of these reforms in a prop-
ture entry-level cars in India, priced around Rs 25 INDUSTRY WANTS BIG-TICKET er and phased manner and make it possible and fea-
lakh, with an annual capacity of 5 lakh units. REFORMS: CII PRESIDENT sible for the growth of India to be happening,” said
Tesla’s move seemed to have fast-tracked in the CII President.
wake of India’s new EV policy, where incentives s the country is inching towards the first Talking about the rise of Sensex from 25000
are proposed for setting up manufacturing units in phase of voting on April 19 for the Lok to 75000 in the 10 years of the Modi government’s
India. ASabha election, India’s top industry body, tenure, Dinesh said that the stock market tends to
The policy has asked for a minimum invest- the Confederation of Indian Industry (CII), has reflect what they’re looking for in the future.
ment threshold of Rs 4150 crore (USD 500 million) come out with its own manifesto, which will push “Looking at more than a 7.6 per cent rate of
and encouraging manufacturers to achieve signifi- the growth of the country. growth, India in 2026-27 will become USD 5 trillion
cant levels of domestic value addition (DVA), the R Dinesh, President, said that the country’s economy, and in 2030 it will become USD 7 trillion
government mandates that by the third year of manifesto should be inclusive of the economic economy,” added CII President.

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