Electric-vehicle giant Tesla Inc. is finally setting up shop in India. The company has registered its operations in Bangalore under Tesla India Motors and Energy Private Limited, Mint reported. Union Minister of Roads, Transport and Highways Nitin Gadkari had revealed Tesla’s plans to set up shop in India in an interview in December, indicating that the government is involved in, or at least monitoring, Tesla’s entry into the country. But the carmaker, which is the most highly valued in the world, has a lot of catching up to do in India.
For one, buying an electric car is a less practical prospect in many parts of the country due to the lack of adequate charging stations, meaning that using an electric vehicle for daily commute or transport isn’t going to be as reliable as a regular vehicle that runs on fuel. The Ministry of Power recently amended guidelines to keep electricity tariffs low for charging stations, to try and encourage their proliferation. Last November, the government indicated a goal of 69,000 such stations to be created (for context, in 2017, India reportedly had a little over 60,000 petrol pumps). Tariffs and local sourcing requirements also pose a problem for the carmaker, which could complicate any prospects of Tesla selling a significant number of its high-end cars in India before it sets up a manufacturing base.
Elon Musk, the world’s richest person and Tesla’s co-founder and CEO, has blamed government regulation and import duties for the time Tesla is taking to launch in India. “For other countries, we pay in part for the local factory by selling cars there ahead of time. Also, gives a sense of demand. Current rules in India prevent that, but recent changes in sales tax give hope for future changes,” he said in 2019. He said in 2017 that the company was seeking a waiver on local sourcing requirements.