Elon Musk-owned electric vehicle maker Tesla is planning to source components worth $1.7-$1.9 billion from India this year, Commerce Minister Piyush Goyal said on Wednesday. Last year, Tesla bought $1 billion worth of components from India, he said.
“Tesla last year already bought $1 billion worth of components from India… this year their target is $1.7-$1.9 billion… I am convinced that this (EVs) is the future. It is something we must try to attract,” Commerce Minister Piyush Goyal said at the annual convention of the Automotive Component Manufacturers Association (ACMA).
According to a Reuters report last month, Tesla’s senior executives met Goyal with an interest in building a factory in India that would produce a low-cost electric vehicle (EV) priced at $24,000, around 25 per cent cheaper than Tesla’s current entry-level model, for both the Indian market and export.
When asked about foreign firms looking to invest in India as part of their China plus one strategy, Goyal said that global companies are coming to India because of its attractiveness.
“I totally debunk and reject the China plus one theory. That’s not what is going to drive India…India of today stands on its own feet. The India of today has offerings for the rest of the world… both for investment and trade,” he said. Goyal added that India provides them good business environment, skills, managerial talent, a big market, and demand generated by 1.4 billion people.
“It’s a rules-based economy…, it’s a young democracy…..one of the fastest growing large economies. All of this makes it a compulsive investment destination. “Therefore companies around the world have gone beyond the China-plus-one story, they have gone beyond the ABC philosophy of anything but China, they have gone beyond friend-shoring or near-shoring and is looking at India as a trusted partner, he added..
The electric auto industry, as it grows worldwide, will see growth in India also, he said. In many cases, for example in taxis, and public transport buses, India is already seeing electric vehicles becoming a very compulsive investment case..
“…as we get large scale production … we will start enjoying the fruits of economies of scale, will start enjoying the fruits of new technologies, innovation R&D coming into India, he said.
(With Inputs from Agencies)