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India to Increase EV Manufacturing Incentives Following Tesla's Disappointment: Report

03 Dec 2024

India is considering expanding electric vehicle incentives to automakers that produce models at their current facilities in the country, instead of limiting the benefits to those establishing new plants, as per the report. India's EV policy, still under finalisation, was initially crafted to encourage Tesla's entry into the market and local manufacturing. However, the US automaker abandoned these plans earlier this year.

According to information from a meeting with India's Ministry of Heavy Industries, which was reviewed by a media outlet, other international automakers have expressed interest in manufacturing electric vehicles (EVs) at both existing and new facilities in India. The policy shift is anticipated to encourage increased EV investments from companies like Toyota and Hyundai, the report stated.

Under the policy announced in March, automakers that invest a minimum of $500 million in manufacturing electric vehicles in India and source 50% of their components locally will be eligible for a significant reduction in import duties—from 100% to 15%—on up to 8,000 electric cars annually. The report added that the government will now also take into account EV investments in current factories that make petrol engines and hybrid cars.

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