India could offer Tesla Inc partial relief on import duties to get electric vehicles shipped to the country, The Economic Times reported on Monday, citing officials.
What Happened:Various stakeholders in the government are open to providing tax breaks but the Elon Musk-led company needs to furnish detailed investment plans first before any decision is taken on the government's part.
“We can offer some relief... but we need to know what their plans are,” an unnamed official told ET.
Tesla claimed it procures components worth $100 million from India and suggested that figure would increase following any tax concessions, according to the report.
The EV maker plans to make significant direct investments in sales, service, and charging infrastructure and evaluate broader investments in manufacturing once it gets the rebates.
Why It Matters:The back-and-forth comes after Musk criticized India’s restrictive policies and tweeted to say that, while Tesla wants to make cars in the country, the import duties there are the highest in the world.
The Palo Alto, California-based company had in a letter to India’s Prime Minister Narendra Modi sought a reduction in import duties on electric cars to 40% from the current 60% to 100%.
Tesla had also requested to scrap the 10% social welfare surcharge that is levied on all imported cars.
Price Action:Tesla shares closed 2.67% higher at $730.91 on Monday.