Give us a road map and timeframe for local supply chain: India tells Tesla

At present, most of Tesla's vendors are Chinese, and they will need to establish joint ventures with Indian firms to operate in the country

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BS Web Team New Delhi

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The government has asked Tesla to submit a road map explaining its India plans and the time it will need to establish local supply chains to begin the domestic manufacturing of its electric vehicles, Financial Express (FE) reported.

Citing government sources, the report said that the government would study Tesla's blueprint before deciding on the concessions that can be extended to the company.

Officials in the know said that Tesla is likely to get back with its detailed proposal for India, and it may take around three to six months for it to set up a domestic vendor base.

The government has already informed the Tesla team that visited the country around two weeks ago, in the middle of May, that if Tesla sets up a domestic assembly unit for its electric vehicles, it is likely to get import concessions on the imported components, the FE report said.

A similar scheme is already operational for the smartphone production-linked incentive (PLI) scheme. However, with time, Tesla will have to start manufacturing locally, which will require local vendors.

Currently, most of Tesla's vendors are Chinese, and they will need to establish joint ventures with Indian firms to operate in the country.

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The government has provided a similar arrangement for Apple under the smartphone PLI scheme. Under it, Apple and Samsung both enjoy duty protection on components required for the domestic assembly of smartphones.

This has resulted in a situation where a number of Apple's Chinese vendors have agreed to set up joint ventures with Indian firms.

Government officials said that since there will be a set timeline for localisation for Tesla, the local auto industry will not have any objections regarding a non-level playing field, the FE report said.

First Published: May 31 2023 | 2:13 PM IST

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