Tesla To Source $1.9 Billion Worth of Auto Parts From India In FY24: Piyush Goyal

US electric automaker Tesla is interested in entering the Indian market and plans to source auto parts worth $1.9 billion from the nation this year, according to Commerce Minister Piyush Goyal.

Goyal revealed during an auto conference on Wednesday (13 September) that Tesla has already procured parts worth $1 billion from India.

"Expect that by 2030, there will be a compulsive economic composition for consumers to buy EVs," Goyal said, reports Economic Times.

In 2021, Tesla made its first attempt to enter the Indian market by urging officials to reduce the 100 per cent import tax imposed on EVs.

However, discussions between Tesla and the Indian government fell through last year when officials insisted that the company commit to local manufacturing.

More recently, Tesla has expressed its interest in establishing a local factory in India.

The company aims to produce a new EV priced around $24,000, which would be approximately 25 per cent cheaper than its current entry model.

This move is intended to cater to both the Indian market and export demands.

Tesla's senior public policy and business development executive, Rohan Patel, has recently been holding private meetings with top officials.

Prime Minister Narendra Modi, who previously had discussions with Tesla CEO Elon Musk in June, has been closely monitoring the progress, according to Reuters.

Apart from its plants in the United States, Tesla currently operates its largest factory in Shanghai and another one near Berlin.

Additionally, the company is in the process of constructing a new plant in Mexico, which will focus on a new mass-market electric vehicle platform.

Elon Musk has stated that this platform will significantly reduce costs for consumers.

Following a meeting between Elon Musk and Prime Minister Modi during the Indian PM's visit to the United States earlier this year to promote development in India, Musk said Tesla will make a substantial investment in India.

“I’m confident that Tesla will be in India and we’ll do so as soon as humanly possible,” Musk told reporters after the meeting.

“We don’t want to jump the gun on an announcement, but I think it’s quite likely that there will be a significant investment, a relationship with India," he added.

Tesla and India resumed their discussions in May after a year-long deadlock.

During a recent visit to India, Tesla executives engaged in talks with government officials regarding the sourcing of parts within the country and potential incentives.

However, these discussions did not result in a formal proposal to establish a manufacturing plant.