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Tesla will not get special benefits in India, tax on imported cars will not be reduced: Ministry of Heavy Industry

Tesla’s setting up of the plant in India is expected to generate revenue of Rs 2.3 lakh crore. Arun Goel, Secretary, Ministry of Heavy Industries informed that the government has received fresh investment of Rs 42,500. He said that the response to the Production Promotion Scheme of the Government of India has been overwhelming and it is being appreciated by the big industries.

Tesla will not get special benefits in India, tax on imported cars will not be reduced: Ministry of Heavy Industry

He said that the government will not encourage any industry to invest in India which does not involve local production. Let us tell you that Nitin Gadkari, Minister of Roads, Transport and Highways has also disagreed on Tesla’s investment policies. He had said that Tesla only wants to establish its business in India by importing cars, which is harmful to an economy. The company will import these cars from its Chinese factory, which will only benefit Tesla and the Chinese government.

Tesla will not get special benefits in India, tax on imported cars will not be reduced: Ministry of Heavy Industry

What is the demand for Tesla?

Tesla had appealed to the Indian government to exempt the tax rate on its cars imported from outside countries. Currently, Tesla is not planning to start manufacturing cars in India, instead the company will import its cars from China or the US. Tesla had written a letter to the Ministry of Transport and Industry in July 2021, urging the company to reduce the import duty on electric cars to 40 percent. At present, the Government of India imposes an import duty of 60 to 100 percent on electric cars.

The Ministry of Industry, Government of India had said that if Tesla starts producing electric cars in India, then only it will be given benefits under the Product Incentive Scheme (PLI). The ministry had also said that Tesla would have to buy auto parts worth $500 million from local manufacturers in India.

Tesla will not get special benefits in India, tax on imported cars will not be reduced: Ministry of Heavy Industry

Tesla made 1 million units of this battery

Tesla completed manufacturing one million units of its 4680-type battery cells to be used in its electric cars in January this year. Tesla has said that this new generation battery will be used in the Model Y. Tesla Model Y electric cars are being produced in Texas, USA. Tesla has been manufacturing its new generation 4680-type EV battery pack since 2020. However, the company has not disclosed the production rate of this battery till date.

Tesla will not get special benefits in India, tax on imported cars will not be reduced: Ministry of Heavy Industry

The new generation 4680-Type Lithium-Ion battery packs are more energy efficient and come with greater energy storage capability, resulting in significantly better performance for electric cars equipped with these batteries. While initially it will be used in Tesla Model Y electric cars, at a later stage, the car brand will use this battery cell in other EVs as well. Tela Model Y electric cars manufactured in Texas are expected to hit the market before the end of this quarter.

Tesla will not get special benefits in India, tax on imported cars will not be reduced: Ministry of Heavy Industry

As revealed by Tesla during the Battery Day event in September 2020, the 4680 lithium-ion battery cell comes with a structural battery pack and is a new cell format. Regardless of whether any new lithium-ion chemicals are used, significant improvements are expected in many areas.

Tesla will not get special benefits in India, tax on imported cars will not be reduced: Ministry of Heavy Industry

680 battery cells come in a larger size, meaning they can store up to five times more energy than the type 2170 battery cells currently in use. For example, the Tesla Model Y Long Range 4416 is powered by a 2170 type battery cell. Less than the made-in-Texas Tesla Model Y 900 will be powered by a 4680 type battery cell with the same capacity. The higher energy density of the battery system could allow the same range to be achieved for electric cars using a smaller battery pack.

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