India to draft new policy in push for EV investment, minister says

By Aditi Shah and Tanvi Mehta

NEW DELHI (Reuters) -India will come up with new policy to attract electric vehicle (EV) manufacturers and encourage greater investment in the sector, the commerce minister said on Wednesday.

Piyush Goyal’s comments come as U.S. EV maker Tesla continues talks with Narendra Modi’s administration on the possibility of building a factory in India.

Reuters last month reported that India was working on EV policy that would cut import taxes for automakers that committed to some local manufacturing, citing sources with direct knowledge of the matter.

Asked about the government’s plans, Goyal said consultation on the new policy will be held with the industry.

“We will come out with a policy,” he said, adding that the government wants to attract more investment and increased domestic EV production as soon as possible.

“As we get large-scale production, we will start enjoying the fruits of economies of scale of new technologies,” Goyal said without disclosing the nature of any possible incentives.

Tesla’s senior executives with an interest in building a factory in India met Goyal in August.

Tesla plans to produce a low-cost EV priced at $24,000 – about 25% cheaper than its existing entry-level model – for both the Indian market and export.

Goyal said on Tuesday that Tesla aims to source components worth between $1.7 billion and $1.9 billion from India this year, having bought $1 billion of components last year.

(Reporting by Aditi Shah, Tanvi MehtaWRiting by Aditya KalraEditing by Jason Neely and David Goodman)