India gets ready for Tesla and other global EVs, Gov to rethink its EV policy

The government of India is organising workshops for companies seeking to import premium electric cars at a lower tariff rate, the Economic Times reported. The step is reported to be taken to revive the dropping interest of companies in the Ev import scheme.

The workshops are designed to receive feedback and to figure out the reasons behind the limited interest in the scheme, the report added. 

In the previous year, the government of India introduced a scheme to decrease import tariffs on elective vehicles in order to increase the local production of EVs while increasing imports as well. The move was planned to invite major electric automakers like Tesla to the Indian market. However, the scheme failed to generate the expected enthusiasm in the global market, pushing the government to rethink its strategy. 

According to the ET, the government intends to hold a workshop later this month for firms interested in the initiative. This session will give an opportunity for enterprises to better understand the scheme and provide comments that may affect the final scheme. This will be the second round of discussions; the first took place in April 2024 and included key firms such as Tata Motors, Maruti Suzuki, Hyundai, BMW, and Mercedes. Tesla's agent in India, The Asia Group, also attended the meeting. Despite these efforts, just a few firms have expressed a significant desire to participate in the initiative.

The Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) reduces import tariffs, under certain conditions, on electric vehicles encouraging companies to import more. According to the scheme, Companies must invest at least $500 million (roughly 4,150 crores) over five years in either developing EV manufacturing or putting up charging stations. Firms must create at least 25% domestic value addition (DVA) within three years, increasing to 50% within five years. Approved firms can import electric automobiles at a 15% customs charge on vehicles worth $35,000 or more, as opposed to the standard higher rate. Furthermore, businesses can import up to 8,000 electric vehicles per year at this reduced cost, with unused import permits carried over to the next year.