Elon Musk Invited by Karnataka to Set Up Tesla Plant as More States Try to Woo the Billionaire

Joining the growing list of Indian states wooing Tesla's billionaire founder and CEO Elon Musk to start a manufacturing unit, Karnataka on Tuesday projected itself as the "Electric Vehicle (EV) hub" of India and an ideal destination to set up a plant.

Several Indian states like Telangana, West Bengal, Maharashtra, Punja,b and Tamil Nadu have already invited Musk to set up shop.

"With over 400 R&D centres, 45+ EV startups & an EV cluster near Bengaluru, Karnataka has emerged as EV hub of India. Mr @elonmusk, Karnataka would be an ideal destination to set up @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 a lot of 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 the company 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 too had said that "American firm 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 first start manufacturing its iconic electric vehicles in India before any tax concessions can be considered.

The government sources had noted that they were not giving such concessions to any auto firm, and giving duty benefits to Tesla will not send a good signal to other companies that have invested billions of dollars in India.

At present, cars imported as completely built units (CBUs) attract customs duty, ranging from 60 to 100 percent, depending on the engine size and cost, insurance and freight (CIF) value less or above $40,000 (roughly Rs. 30 lakh).