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Government Tells Elon Musk No Local Sourcing Required For Tesla Manufacturing

Elon Musk had said that there might be a delay in Tesla's India launch due to the regulations.

23/05/2017 7:18 PM IST | Updated 23/05/2017 7:45 PM IST
Stephen Lam / Reuters

A simple tweet exchange may help speed-up the process for the Indian launch of the much-awaited electric sedan Tesla. A day after reports indicated that the car's entry to Indian markets may be delayed due to local sourcing regulations, the Commerce & Industry ministry is trying to set the record straight.

A tweet to Musk from the Indian government-run "Make In India" handle on Tuesday clarified some concerns expressed by the Tesla CEO.

Yesterday Musk had said on Twitter that there might be a delay in bringing the electric sedan to India because of the regulations on importing components.

In the tweet, the Indian government clarified that the country's FDI policy doesn't mandate any local sourcing norms for components. As long as the car is produced India it can be sold in any manner--retail, wholesale or e-commerce. The policy also permits the wholesale of imported goods.

This was in response to Musk's earlier tweet.

Last year Tesla had made its Model 3 available for pre booking in India with a vision to enter the market in 2017 or 2018.

Prime Minister Narendra Modi and the transport minister Nitin Gadkari both had visited the Tesla plant in the US. Gadkari had offered the lands near Indian ports for export purposes.

Many if the car manufacturers in India import the vehicles. The duty on the cars worth less than $40,000 is 60 percent. Tesla's retail price is $35,000 in the US. The price of the imported Tesla in India would be approximately ₹37.18 lakhs, reported DNA.

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