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New Delhi, NFAPost: As the negotiations between Elon Musk’s Tesla entry is awaited with bated breath by automobile afficianados, Modi government has made it clear that US electric car manufacturer should set up its Giga Factory in India for its larger global plan.

The company which wants to launch cars in India, has expressed concerns over the high import duties on electric vehicles (EVs), which would raise the cost of its cars to unimaginable rates. According to PTI sources, the Centre has made it clear that the government is not giving such concessions to any auto firm.

The heavy industries ministry has stated that giving duty benefits to the Elon Musk-led company will not send a good signal to other companies that have invested billions of dollars in India and are manufacturing their vehicles domestically.

In a ‘Make in India’ push, the Centre has asked the electric car company to initiate production in India first.

The Government’s response comes after Tesla wrote a letter to the Road Ministry, requesting it to standardize the tariff on electric cars to 40% and withdraw the social welfare surcharge of 10 per cent on electric cars.

As per the policy, import duty on electric vehicles in India is 100% if the CIF (cost, insurance, and freight) value is more than $40,000 or 60% if the CIF value is less than $40,000. The heavy import duties thereby affect the price of Tesla cars which could considerably shrink its market in India.

Tesla has already chosen to opt and complete the homologation stage for four vehicle models that it has sought approval for in India. Tesla India Motors and Energy, the India subsidiary of Tesla Inc., has secured permissions for four of its car versions, according to information provided by the Centre-controlled Vahan Sewa.

Although it is not mentioned which models or versions have received the permissions, Tesla test cars like Model 3 and Model Y have been previously tested on Indian roads.

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