Indian govt has approved a new EV policy that allows EV imports at reduced duty of 15% temporarily for 40,000 units at 8000 max per year.
- Requires minimum investment Rs. 4150 crore($500M)
- 3yrs for setting up manufacturing facility & reach 50% value addition in 5 years(25% by 3rd yr)
- The customs duty of 15% would be applicable on vehicle of minimum CIF value of USD 35,000 and above for a total period of 5 years subject to the manufacturer setting up manufacturing facilities in India within a 3-year period.
-The duty foregone on the total number of EV allowed for import would be limited to the investment made or ₹6484 Cr (equal to incentive under PLI scheme) whichever is lower. A maximum of 40,000 EVs at the rate of not more than 8,000 per year would be permissible if the investment is of USD 800 Mn or more. The carryover of unutilized annual import limits would be permitted.
How will this work?
Can Tesla start importing immediately? No. There will be a application and approval process with bank guarantees. Govt says they will invite application within 120 days. So should happen relatively soon.
Bank Guarantees-
Can any company participate in this? Well yes, if they meet certain eligibility criteria.
Rs. 10,000 crore annual revenue requirement will make it tough for Fisker, VinFast etc. Here's hoping everything happens quickly! Policy is finally here, late, but better than never. Bring that Giga now Elon!