As per newest reports coming in, the Tata Group is not in favour of reducing import duty for electric cars. The leading car maker is pushing for car parts to be made in India.
The Tata Group has reportedly resisted any reduction in the import duty that can be implemented on electric cars, which has been demanded by Elon Musk, the CEO of Tesla.
Tata Group Against Reduction In Import Duty
Tata Group believes that reducing import duty does not align with the Indian Government’s FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicle). This particular project promotes indigenisation of green vehicles and localisation.
As per Shailesh Chandra, President, Tata Motors, passenger vehicles business unit, efforts should be taken against subsidised imports because localization is important for an increased adoption of EVs and making them affordable as well.
He said, “FAME has really focused on two aspects. The first aspect is bringing affordable EVs… which are less than Rs 15 lakh. The second very clear articulation is localisation. Because if you have to really drive electrification on a sustainable basis, till you don’t ensure a road map for local value addition, this will not be sustainable.”
Chandra also said that Tata Motors makes up for more than 90% electric vehicles that are sold in India via Nexon have taken FAME as ‘one single reference’ as they planned for expansion.
In August, it was reported that India has no intention to reduce import duties on electric vehicles (EV).
Tesla CEO Demands Reducing Import Duty
Chief Elon Musk had responded to tweets asking him when the company would arrive in India, saying that it could set up a local factory here once it starts selling wholly-built units from overseas to test Indian market response.
The government wants to increase local manufacturing whereas Tesla wants the government to allow import of its cars at a cheaper rate before it commits to setting up local production facilities.
Before beginning to produce Tesla cars in India, it should be allowed to start selling its cars here through imports.
Musk had repeatedly expressed interest in entering India which is one of the world’s most promising automobile markets.
He then expressed frustration due to local rules which do not allow him to test the market reception by selling imports first, since high duties make the cars unaffordable.
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