India’s Commerce Minister, Piyush Goyal, said September 13 that the country was planning to enact a new policy that will attract more EV manufacturers to the country and more investment from the electric vehicle sector. Prior to this announcement, American car maker Tesla has held ongoing talks with Indian PM Narendra Modi's administration to build a factory in the country.
Goyal said that the government will consult with members of the EV sector on the new program.
"As we get large-scale production, we will start enjoying the fruits of economies of scale of new technologies," Goyal added without specifying any incentives for car manufacturers under the proposed program.
According to Reuters, the new policy comes after Tesla announced plans to manufacture a low-cost electric vehicle for the Indian market that is roughly 25% cheaper than existing entry-level models. In August, senior executives at Tesla who have an interest in building a factory in India met with Goyal.
Goyal added that Tesla is looking to source car parts from India this year that will be worth between $1.7 billion and $1.9 billion. In 2022, the company purchased $1 billion worth of vehicle components from India.
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