Make-in-China won't allow reaping benefits in Indian marketplace

New Delhi – Union Minister Nitin Gadkari told the Tesla Motor Company that the concept of manufacturing cars in China and selling them in India is not digestible. This company manufacturing electric cars demanded that the import duty on electric cars be reduced in India. Thus, Gadkari reacted against this background. While answering a question regarding this subject, Union Minister for Heavy Industries Krishnan Pal Gurjar presented the government’s stand in frank words. Gurjar said that creating employment in China and reaping the benefits in the Indian market is not acceptable.

Moreover, Gurjar clarified ‘Indian Doors are open for Tesla Motors. They can choose to set up manufacturing facilities in India, creating employment. This will also increase the government revenue. But Tesla has not shown willingness for this. Therefore, the policy of Tesla to create employment in China and sell cars in India will not be tolerated by the Indian government. The government’s stand is that if you want to enjoy benefits of the Indian market, employment has to be created in India.’

The government has implemented a ‘Production Linked Incentive’ scheme and even the foreign companies are eligible for the benefits offered. Gurjar suggested that Tesla Motors can also benefit from the scheme and set up their manufacturing facility in India. Meanwhile, Union Minister Nitin Gadkari also presented the stand of the Union government while speaking to the media. Gadkari informed that he had held talks with Tesla Motors for setting up their new plant in India. Gadkari said that he also had pointed out to the company that the idea of manufacturing cars in China and selling them in India was not acceptable.

Gadkari reprimanded, ‘We have no objection if the company still wishes to manufacture their cars in China and sell them in India. But in that scenario, Tesla will have to pay the applicable import duty like the other companies. There will be no concessions available.’

It has become difficult to manufacture in China given the Coronavirus pandemic, electricity shortage and reactions received from around the globe regarding the policies of the communist regime. Therefore, now the multinational companies have started exiting from China, also known as the world’s factory. There is intense competition among countries to attract them to set up their facilities. Many multinational companies are expressing interest in coming to India, given the huge market, democratic systems and availability of skilled labour. The union government has implemented fiscal reforms and has introduced encouragement programs like ‘Production Linked Incentive’ and is appealing to the multinational companies to come to India.

The Indian appeal is receiving a positive response and some multinationals are already making huge investments. At the same time, some companies are in negotiation with the union government. Therefore, the union government has delivered a clear message that the companies investing in India only will reap better benefits from the Indian marketplace. The union government has pointed the same thing to Tesla Motors.