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Tesla has launched talks with the Indian government for the construction of an EV factory in the country with an annual production capacity of half a million vehicles.
The Times of India reported that the starting price of the cars produced at the future facility will be around $24,400.
“Tesla has come to us with an ambitious plan, and we are confident that the movement will be positive this time around especially as it involves both local manufacturing and exports,” the report cited an unnamed government official as saying.
Plans also include using the subcontinent as an export hub for the whole Indo-Pacific region, the source also told the Times of India.
Last month, Reuters reported that the EV maker was planning a large-scale investment in India despite past setbacks in its negotiations with the Modi government.
The report quoted Tesla’s chief executive Elon Musk as saying that "He (Modi) really cares about India because he's pushing us to make significant investments in India, which is something we intend to do."
"I am confident that Tesla will be in India and will do so as soon as humanly possible," Musk added.
Last year, EV sales in India rose to 50,000, which was a fourfold increase from 2021 but still a meager number compared to the 1.4 million EVs sold in China in the same year. According to the International Energy Agency, however, sales of electric vehicles in India have the potential to really take off.
Tesla had plans to set up shop in India last year but scrapped those plans when the Modi government refused to lower import taxes on cars—these taxes in some cases reach 100%, which would make Teslas prohibitively expensive. The idea of the government was to motivate Tesla to manufacture cars locally rather than import them.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com