Tesla to source auto parts worth $1.7-$1.9 billion from India this year, says Piyush Goyal

Union Minister Piyush Goyal was addressing the ACMA annual convention

Electric vehicle maker Tesla Inc is planning to source automobile components worth $1.7-1.9 billion this year, Union Commerce Minister Piyush Goyal said on September 13.

The quantum of imports will be around double as compared to auto parts worth $1 billion imported by Tesla from India last year, Goyal said, while addressing the annual convention of Automotive Component Manufacturers Association (ACMA).

"Tesla last year already bought $1 billion worth of components from India... this year their target is $1.7-$1.9 billion," Goyal said.

"I am convinced that this (EVs) is the future. It is something we must try to attract," news agency Reuters further quoted him as saying.

Notably, India’s auto components industry, which accounts for 2.3 percent of the country’s GDP, is set to become the third-largest globally by 2025, according to the government.

Goyal's statement on Tesla planning to increase the quantum of imports comes around two months after reports said that the Elon Musk-led EV maker has held talks with the Indian government, and is exploring the possibility of bringing its auto parts and electronics chain to India and getting sops and tax breaks in the process.

The US-headquartered company has shown interest in bringing its own supply chain ecosystem to India, even as the government has asked the company to assess the existing auto components supply chain in the country, the Economic Times reported on July 13.

Moneycontrol couldn't verify the report independently.

After meeting Prime Minister Narendra Modi during his trip to the US in June, Tesla chief executive Elon Musk had said: "He (PM Modi) really cares about India because he's pushing us to make significant investments in India, which is something we intend to do."

Musk also called himself a "fan of Mr Modi" and said that India had "more promise than any large country in the world".

Tesla executives had also held discussions with senior Indian officials and ministers in May this year on establishing a manufacturing base for cars and batteries in India. The world's largest electric car maker shelved its India entry plans because of high import tax structures.