Centre Likely To Modify New EV Policy As Tesla Gears Up To Enter India

As Tesla prepares to enter India this year, the government is likely working on to modify the terms of a new policy that promotes manufacturing of electric vehicles (EVs) in the country.

In a bid to attract the likes of Tesla, the tweaked EV policy may mandate carmakers to show a turnover of Rs 2,500 crore in the second year itself, as per sources. Centre may also offer further import duty relief.

The government is likely to start accepting applications after the updated EV policy is notified in mid-March. The approvals are likely to be given by August and imports to start soon after, reliable sources added.

Elon Musk-run Tesla will not immediately start manufacturing in the country but rely on imports from its Berlin Gigafactory in Europe, and gradually increase local procurement.


While all eyes are on Elon Musk-run Tesla to make its entry into India, the government is expecting a good response from several automobile majors on the EV policy.

The new EV policy was announced in March last year, where the government reduced the customs duty to 15 per cent with certain conditions.

It entailed a minimum investment of Rs 4,150 crore to set up EV manufacturing facilities, production to start within three years and reach 25 per cent DVA (domestic value addition) by three years and 50 per cent DVA within five years at the maximum.


The new EV policy paved the way for Musk and other automakers to enter the Indian EV market.

According to experts, the EV market in the country can achieve over 40 per cent penetration with $100 billion revenue by 2030.

Meanwhile, Musk-run EV major is set to take a "top-down approach" - launch expensive models in India first and then follow it up with the cheaper vehicles.


The electric car maker is reportedly set to import its fully-built Model Y from its Berlin Gigafactory, as the electric SUV is manufactured in right-hand drive configuration in the European facility.

Tesla, which has an office in Pune, is reportedly searching for locations in Bandra-Kurla Complex (BKC) in Mumbai and Aerocity in Delhi to set up their first showrooms in the country.

The company has advertised for at least 13 new roles, mostly for the Mumbai and Delhi markets. The jobs include business operation analyst, service technician and various advisory roles, including customer engagement manager and order operations specialist, as per its LinkedIn advertisements. —IANS