Government says no to subsidy on import duty on EVs into India

Tesla's plans to enter the Indian market has hit a policy roadblock.

There is no proposal to provide subsidy on import duty on imports of electric vehicles into the country, the Parliament was informed on Wednesday, December 13. Minister of State for Commerce and Industry Som Parkash said the government has taken a series of policy initiatives and measures to create a conducive ecosystem to promote industrialisation and domestic value addition and to make India globally competitive.

The government has also taken various steps to boost domestic and foreign investments in India to enhance local value addition under the 'Make in India' initiative, the minister said in a written reply to the Lok Sabha.

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"Presently, there is no proposal either to provide exemption from local value addition cost or to provide subsidy on import duty on import of electric vehicles in India," Parkash said.

He also informed that the government has launched the Production Linked Incentive (PLI) scheme for automobile and auto component industry with a budgetary outlay of Rs 25,938 crore to provide financial incentives to boost domestic manufacturing of advanced automotive technologies products, including electric vehicles and their components.

The scheme incentivises the establishment of giga scale ACC manufacturing facilities in the country for 50 GigaWatt hour (GWh).

The minister said this while replying to a question whether it is a fact that the government has a proposal under consideration to exempt Tesla and other multinational car companies from local value addition of cost in heavy batteries, semiconductors and even magnetic parts and also subsidy on the import duty on the import of electric vehicles in India.

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