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Karnataka now invited Elon Musk to set up a factory in the state

By Ruchi Upadhyay 
Updated Date

Bangalore: After Telangana, Maharashtra, Tamil Nadu, Punjab and West Bengal, Karnataka has invited Tesla CEO Elon Musk to set up a manufacturing unit in Karnataka. Furthermore, he sought extra attention from the billionaire, saying that Karnataka is India’s “electrical automobile hub.”

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“With over 400 R&D centres, 45+ EV startups & an EV cluster near Bengaluru, Karnataka has emerged as the EV hub of India. Mr @elonmusk, Karnataka, would be ideal for setting up the @Tesla plant. Bengaluru is already Tesla’s maiden address in India,” Karnataka Minister for Large and Medium-scale Industries Murugesh R Nirani tweeted.

Musk had recently tweeted that the US-based firm is working through many challenges with the government to launch its products in India.
“Still working through a lot of challenges with the government,” Musk tweeted in reply to a Twitter user, who asked: “Yo @elonmusk, any further update as to when Tesla’s will launch in India? They’re pretty awesome and deserve to be in every corner of the world!”

In January 2021, Tesla registered its Indian arm amid indications that it is set to enter the country’s automobile market. According to a regulatory filing, the firm registered Tesla India Motors and Energy Pvt Ltd with RoC (Registrar Of Companies) Bengaluru. The company has been registered as an unlisted private entity with a paid-up capital of Rs 1 lakh.

In February 2021, the then Karnataka Chief Minister B S Yediyurappa also said that “American agency Tesla will set up the car-manufacturing unit in Karnataka.” Last year, Tesla had sought a reduction in import duties on electric vehicles (EVs) in India. The union-heavy industries ministry had asked the electric car major to start manufacturing its iconic electric cars in India before any tax concessions could be considered.

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Government sources had noted that they were not giving such concessions to any auto firm. Extending duty benefits to Tesla will not augur well for other companies that have invested billions of dollars in India. Currently, cars imported as Completely Built Units (CBUs) attract customs duty of 60 to 100 per cent depending on the size and cost of engine, insurance and freight (CIF) value less or above USD 40,000.

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