Tesla makes big plans for India: May set up factory, make new car for developing nations

As India moves closer to drafting a new electric vehicles (EV) policy, Tesla is in advanced talks to make an entry into the country and may be open to committing nearly $30 billion in investments, directly and indirectly, over the next five years in a manufacturing plant, and battery ecosystem and ancillary industries, people closely involved with the company's official business plans said.

This may include a direct and immediate investment of $3 billion to produce a new small car from an Indian plant for the wider developing world, a $10 billion commitment from other partners to support this manufacturing venture, and a cumulative $15 billion in the battery industry ecosystem over a five-year period, the people added.

If the new EV policy - which is a broader policy and not specific to Tesla-meets Tesla's ask of a rebate in the current structure of import duty for foreign-made EVs, the company first plans to bring a limited number of its standard brands to compete in the Indian luxury car market while begin building and testing a charging ecosystem. Simultaneously, Tesla may also invest in a factory in India to roll out the first small car within two years, with the facility completed within three years. The pricing structure of the car hasn't been determined but it is likely to be a cheaper model that the usual Teslas to cater to the demands of countries in Asia, Africa and Latin America. This factory, with a high degree of local made-in-India content, may cater partially to the Indian market and substantially focus on exports, the people cited above indicated.