Elon Musk ‘looks forward’ to meet PM Modi: What Tesla’s arrival will bring to India

It hasn’t been a year since Prime Minister Modi met Tesla chief Elon Musk in the US during a political visit in June 2023. Fast forward to April 2024, there are strong speculations that the electric vehicle giant will finally set foot in the growing Indian automotive market. Musk, confirming his impending visit to India, wrote on X “Looking forward to meeting Prime Minister Narendra Modi in India!”
It’s an open secret that Tesla was seeking a reduction in import duties in order to enter the Indian market and the central government’s newly-introduced EV policy will sort of boost the company’s aspirations, although there are certain conditions that need to be met.
Tesla’s arrival imminent but conditions need to be met
Global companies (planning to set foot in the Indian EV market) need to invest at least Rs 4,150 crore (around USD 500 million) to set up electric vehicle manufacturing plants in India. There's no limit on how much they can invest. These companies have three years to start their operations and begin making electric cars on our shores. Also, within five years, these companies must use at least 50 percent locally-produced parts in their cars, and by the third year, 25 percent of the parts must be made in India.

Tesla can import a limited number of electric cars to India at a lower tax rate of 15 percent, as long as they invest at least USD 500 million and set up manufacturing plants in India within three years. Otherwise, the tax rate is 70 percent.
As per PTI sources, Musk, during his visit, is likely to announce the company’s investment plans for India.
Impact on India if Tesla arrives
Once Tesla officially enters India, it will result in a direct and indirect economic boost for the country. First of all, setting up these factories and operating them on a long-term basis will create job opportunities in the country.
Furthermore, enhanced localisation of the vehicles will lead to reduced prices, making Tesla EVs more affordable for the Indian consumers. Besides that, having a potent OEM that knows the EV game well, will likely encourage other manufacturers to equip their vehicles with better features, performance, and pricing.
However, these are, as of now, just speculations. Only time and Musk’s arrival will tell how and when Tesla plans to start its operations in India.