India is all set to legislate new policies for increasing investment in EVs

India will develop new regulations to entice producers of

electric vehicles (EVs)

Goyal's remarks come as American electric vehicle manufacturer Tesla continues to discuss the prospect of establishing a facility in India with the Narendra Modi administration.

According to people with intimate knowledge of the situation, Reuters reported last month that India was developing an EV strategy that would lower import levies for automakers that committed to some local manufacture.

When asked about the government's plans, Goyal stated that the industry will be consulted on the new regulation. The administration wants to enhance domestic EV manufacturing as quickly as feasible and attract more investment, therefore he said, "We will come out with a policy."

Goyal stated, "As we get large-scale production, we will start enjoying the fruits of economies of scale of new technologies," without elaborating on any potential inducements. Senior officials from Tesla who were interested in constructing a manufacturing in India met with Goyal in August.

For both the Indian market and export, Tesla intends to create a low-cost EV priced at $24,000, which is roughly 25% less expensive than its current entry-level model.

Tesla, which spent $1 billion on parts last year, plans to purchase components from India this year in the range of $1.7 billion and $1.9 billion, according to Goyal, who made the announcement on Tuesday.