Tesla eyes investment in India: Plans to set up electric vehicle factory and export hub

Tesla is currently in discussions with the Indian government regarding an investment proposal to establish a factory capable of producing approximately 500,000 electric vehicles on an annual basis, as reported by the Times of India, citing government sources. Led by billionaire , Tesla is also exploring the possibility of utilizing India as a manufacturing hub to export cars to nations in the Indo-Pacific region, according to the same report.

According to the report, the vehicles from will have a starting price of 2 million rupees ($24,400.66). This price point is more than double the cost of India's most affordable , the MG Comet, and half a million rupees higher than the Tata Nexon EV, which currently holds the position of the highest-selling electric car in the country.

Tesla faced a setback in its plans to enter the Indian market last year when the government declined to reduce import taxes on its vehicles. Currently, the country imposes import taxes as high as 100 percent on electric vehicles, which hindered Tesla's entry into the Indian market.

India expressed a strong interest in within the country, but the company initially aimed to export its cars to India to assess the demand. However, in a recent shift in strategy, Tesla engaged in discussions with Indian officials in May to explore potential incentives provided by the government for both its cars and battery manufacturing, as reported by Reuters. This indicates renewed efforts by Tesla to enter the domestic Indian market with a different approach.

According to local media reports, the discussions this time are being led by the , which aims to negotiate a mutually beneficial agreement while ensuring a fair competition between local manufacturing and exports. The ministry is working towards assembling a "good deal" that takes into account both aspects of Tesla's involvement in the Indian market.

During a meeting with Elon Musk last month, Indian Prime Minister Narendra Modi urged Tesla to make a "significant investment" in the country. However, Reuters' requests for comments from the Commerce and Industry Ministry, Tesla, and Musk went unanswered at the time of reporting.

Tesla's potential investment plans in India. It appears that Tesla is actively engaged in discussions with the Indian government regarding the establishment of a factory capable of producing electric vehicles in the country. The company is also considering India as a potential manufacturing hub for exporting cars to the Indo-Pacific region.

The reported starting price of 2 million rupees for Tesla's vehicles in India suggests that they would be positioned in the premium segment of the market. This price point is higher than the current most affordable electric car in India, the MG Comet, and significantly higher than the Tata Nexon EV, which is currently the highest-selling electric car in the country.

It's worth noting that Tesla faced challenges in entering the Indian market due to high import taxes on electric vehicles. However, the recent discussions with Indian officials indicate renewed efforts by Tesla to explore potential incentives and establish a presence in the domestic Indian market.

The involvement of the Ministry of Commerce and Industry in these discussions highlights the government's focus on striking a mutually beneficial agreement that considers both Tesla's interests and local manufacturing and exports. Prime Minister Narendra Modi has also expressed a desire for Tesla to make a significant investment in the country.

It's important to note that the information you provided is based on reports from the Times of India and Reuters, and official confirmation or further details from Tesla or the Indian government may be necessary to confirm the specific plans and timelines for Tesla's investment in India.