On September 15, the Union Cabinet approved a PLI Scheme for the auto sector worth Rs 25,938 crore with the goal of stimulating the production of sophisticated automotive technology items such as electric and hydrogen-fueled automobiles.
While India waits for Tesla to arrive with its fleet of electric vehicles, the California-based automaker has yet to confirm the introduction of its first vehicle due to ongoing talks with the government over high import tariffs.
According to sources, Tesla was recently asked by the Indian government to submit its production plans before receiving any tax breaks.
On September 15, the Union Cabinet approved a PLI scheme for auto sector worth Rs 25,938 crore with the goal of stimulating the production of sophisticated automotive technology items such as electric and hydrogen-fueled automobiles.
PTI described Pandey as reacting to the impact of the Centre’s announcement of a Rs 25,938-crore production-linked incentive to stimulate local manufacturing of innovative automotive technology items such as electric automobiles. “Tesla will definitely be attracted to this scheme…I am hopeful,”
“The scheme will give a huge boost to the auto sector and make it globally competitive. We have received huge positive responses from all the industry on the scheme,” Pandey said.
Tesla CEO Elon Musk raised doubts about introducing its electric vehicles in India a few weeks ago, claiming that the country’s import duties are among the highest in the world.
Tesla has encouraged the government to lower the tax on electric vehicles to 40%, rather than the existing rate of 110 percent, regardless of the customs value.
However, if the Centre agrees to Tesla’s ideas, he has intimated that a Tesla factory in India is “very likely.”
The Centre reportedly asked the US-based EV company to increase local procurement and submit comprehensive manufacturing plans before considering its request for a tax cut earlier this month.
Tesla has won approval to manufacture or import four of its models in the country, putting it one step closer to making this a reality. In India, the four Tesla models have been certified as roadworthy.
The production-linked incentive or PLI scheme for auto sector has been authorized by the Indian government. The initiative, which was announced by MoS Finance Anurag Thakur and approved by the Union Cabinet, is aimed at encouraging the use of alternative fuels in India as well as technological advancement.
The government has sanctioned Rs 26,058 crore for the PLI plan, which would begin in FY23 and run for five years, using 2019-20 as the base year for eligibility criteria.
The initiative, according to the minister, would help the auto industry grow and become more globally competitive.
