Elon Musk's Tesla plans to invest up to $2 billion in India plant: Report

Elon Musk's Tesla Inc is planning to set up a manufacturing factory in India to produce electric cars in the country. The auto company is reportedly mulling the idea of setting up the plant in India with an investment of $2 billion. However, the auto company has proposed a condition for setting up its local manufacturing plant in India. Reuters has reported that Tesla has given a condition that it will invest in the local production facility only if the Indian government approves a concessional duty of 15 per cent on imported vehicles in the first two years.

Tesla has reportedly approached the Indian government with regard to the investment the auto company is planning to make in the country and the number of cars it can import at lower duty. The automaker has reportedly proposed different slabs with regard to its investment and the number of cars it wants to import with concessional tariffs. The electric carmaker has proposed to invest up to $500 million if the Indian government extends a concessional tariff for 12,000 imported Tesla cars. The automaker reportedly plans to increase the investment amount to up to $2 billion in the country, if the import duty concession is extended for 30,000 cars.

The proposal is reportedly being evaluated by the Department for Promotion of Industry and Internal Trade (DPIIT, the Ministry of Heavy Industries (MHI), the Ministry of Road Transport and Highways (MoRTH), and the Ministry of Finance under the guidance of Prime Minister's Office (PMO). The report has also claimed that the Indian government is examining the viability of Tesla's proposal but wants to reduce the number of cars imported on a lower duty, compared to what the EV manufacturer has proposed.

This comes as the latest development in Tesla's India plan, as the automaker is aiming to grab a chunk of the country's bulging EV market as well as wants to use the country as a global production hub.