India may reduce its import duties to attract abroad-based OEMs including Tesla

Relief may be on the way for foreign

electric vehicle (EV)

According to sources who spoke on the condition of anonymity, all fully built-up (CBU) vehicles under $40,000 now have an import charge of 70%; but, under a new national EV strategy, that duty may be reduced to 15–30% for EVs costing up to $25,000–35,000. These CBUs will have an import tariff of 15%, which is the same as that of fully knocked down (CKD) autos. Along with the need that they start local production within the next two to three years, this will also include a condition allowing them to recoup the duties if they fail to do so.

As it searches for new markets in the midst of a recession in the West and increasing competition from regional competitors in China, Elon Musk's Tesla has launched a second campaign to lower EV taxes in India. According to the sources, the American automaker is aiming to attract buyers in the upper echelons of India's expanding mass-premium EV market rather than competing with luxury brands for a select group of affluent consumers. India's market for electric automobiles is almost double the size it was last year, with sales jumping from about 33,000 units.