Earlier, the minister had said Tesla is welcome to manufacture its EVs in India, but the company must not import cars from China.
India has several times turned down a demand of Elon Musk’s Tesla Inc. for tax breaks to import electric cars, saying rules already allow bringing in partially-built vehicles and assembling them locally at a lower levy.
"If Elon Musk (Tesla CEO) is ready to manufacture in India then there is no problem ... Come to India, start manufacturing, India is a large market, they can export from India," he had said at an interactive session at the Raisina Dialogue.
At present, cars imported as Completely Built Units (CBUs) attract customs duty ranging from 60-100%, depending on engine size and Cost, Insurance and Freight (CIF) value less or above $40,000.
Prime Minister Narendra Modi’s administration has encouraged Tesla to produce locally, while Musk wants India to lower taxes -- as high as 100% on imported EVs -- to enable the company to first sell vehicles built elsewhere at competitive prices.
The Budget earlier this year didn’t mention any tax breaks for cleaner but imported vehicles, even though the western state of Maharashtra -- home to financial capital Mumbai -- publicly backed Tesla’s demands.
Indian roads are still dominated by cheap, petrol- and diesel-powered cars made by the local units of Hyundai Motor Co. and Suzuki Motor Corp, with electric vehicles accounting for less than 1% of total sales, underscoring a huge opportunity for EV-makers in the world’s second-most populous nation.
Tesla first disclosed definite intent of entering India as early as 2019, but Musk said local rules prohibit him from testing the waters first with imports, as high duties make Tesla cars “unaffordable." In October, an Indian minister said he had asked Tesla to avoid selling China-made cars in the country, and urged the automaker to manufacture, sell and export vehicles from a local factory.
