The company — which has a significant presence in China, including factories — is also looking at using India as an export base as it plans to ship cars to countries in the Indo-Pacific region, government sources told TOI.
“Tesla has come to us with an ambitious plan, and we are confident that the movement will be positive this time around, especially as it involves both local manufacturing and exports,” a source said. The commerce and industry ministry is leading the talks and the government is hoping to put together a ‘good deal’ while maintaining a level-playing field.
Incredibly excited about the future of India: Elon Musk
A questionnaire sent to the company’s headquarters in the US remained unanswered at the time of going to press.
The turnaround in Tesla’s plans to invest in India comes within weeks of CEO Elon Musk’s meeting with PM Modi during the latter’s high-profile visit to US last month. Musk had then said that he was a ‘fan of Mr Modi’ and added that the PM had been pushing him to invest in India.
“He (Mr Modi) really cares about India because he’s pushing us to make significant investments in India, which is something we intend to do. We are just trying to figure out the right timing … I am confident that Tesla will be in India and will do so as soon as humanly possible,” Musk had said on June 21.
Tesla had reopened the dialogue channels with the government in May when a team from the company visited India amonth ahead of Modi’s visit. Tesla’s potential investment in India is seen as part of a globalstrategy by companies to diversify their production bases beyond China, although Musk remains more than upbeat on the Asian manufacturing giant. If the proposal goes through, it will be a big boost for the government’s ‘Make in India’ pitch, which has seen the likes of Apple’s vendors significantly invest in domestic production and use the country as a base for exports.
Tesla has been eyeing the Indian market for years but abandoned plans to move in last year after failing to get special incentives from the government for importing its cars at lower duty.
The government had been firm on its demand that the company manufacture cars locally instead of importing them here from other locations, including China. On its part, India has also been aggressively pushing the high-potential of the local car market, which is now the world’s fourth-largest after closing last year with sales of around 3.9 million units, behind only China, US and Japan.