Tesla Eyes $2 Billion Investment for New Indian Factory Amid Import Duty Negotiations

Tesla is ready to invest $2 billion in an Indian factory, dependent on lower import duties for electric vehicles.

Reuters reported Tesla is poised to invest up to $2 billion in establishing a factory in India, contingent on a significant reduction in import duties for its vehicles.

The company has proposed this investment with the expectation that the Indian government will lower the import duty on its cars to 15% for the initial two years of operations. This move aligns with India’s ongoing efforts to reform its electric vehicle (EV) policy, aiming to cut import taxes to as low as 15% in exchange for commitments to local manufacturing.

Tesla, led by Elon Musk, is willing to invest $500 million if the Indian government agrees to reduce duties for 12,000 vehicles, escalating to a $2 billion investment if the concession extends to 30,000 vehicles. However, the Indian government is currently assessing the feasibility of Tesla’s $2 billion investment proposal, showing interest in reducing the number of cars imported at a lower duty compared to Tesla’s proposition.

As of now, Tesla and various Indian ministries involved in this potential deal have not responded to inquiries for comments