Elon Musk Confirms Plans to Bring Electric Vehicles to India Market

Tesla CEO Elon Musk has confirmed plans to bring electric vehicles to India “next year for sure”. The news comes from Musk’s response to a Twitter account called Tesla Club India, which asked if Tesla was making any progress on previous hints that Tesla was interested in expanding to the Indian market.

Tesla is already in discussions with Indian officials to open a research and development center in the country. Statements from officials indicate that the state of Karnataka, in the south of India, is a front-running contender for the location of this center. Karnataka is the first state to adopt a policy for electric vehicles.

“Tesla has shown initial interest to invest in a research and innovation center in Karnataka, and the talks are at a preliminary stage,” an official told the Indian Times.

Musk has previously sited regulation and import taxes as reasons that electric vehicles manufactured by Tesla are not seen often in India yet. The taxes alone could as much as double the price of a Tesla vehicle, making them unaffordable to many Indians who might otherwise consider buying one. The cheapest model currently starts at $35,000, though Tesla does have a new $25,000 model coming down the pike.

Besides the regulation issue, India’s electrical infrastructure may not yet be able to support an enormous influx in electric vehicles. As many as 300 million Indians did not have access to power or had only limited access as of October 2015 due to challenges in producing electricity and delivering it to customers. A less fortunate electrical consumer might only be able to draw enough power to keep a single low-wattage light bulb going. The issue has often been blamed on outdated and deteriorating infrastructure.

However, India is currently making inroads toward solving this issue. Over the past few years, India has worked on making upgrades to its power grids and retrofitting homes with access to electricity. Official government policy calls for the development of renewable and sustainable energy sources like nuclear, solar, and wind power so that its entire population can have access to electricity without significantly increasing its carbon emissions.

Private industry insiders have also indicated enthusiasm for electric vehicles as part of a path to energy independence for India. The challenge will be the development of the infrastructure needed to support them.

“We all accept that the future is electric, it is now time to embrace electrification as an opportunity to create a self-reliant and cleaner India,” Avendus, an Indian financial services firm, said in a July statement.

On the positive side, Tesla does have the support of Prime Minister Narendra Modi. In 2015, Musk gave Modi a tour of Tesla’s factory in Fremont, California. News reports at the time indicated that they broached the topic of opening a similar factory in India as a fix for the import tax issue. However, regulations appear to have held up any plans to build the factory.

That may change now that twelve Indian states, including Karnataka, have adopted policies for electric vehicles that may be friendlier toward Tesla’s planned expansions.