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Indian think tank: India promotes foreign new energy vehicle companies to invest in India, and Chinese companies may be the main beneficiaries

According to the Indian "Economic Times" reported on the 24th, the Indian think tank "Global Trade Research Initiative" released a report on the same day that India actively promotes foreign new energy vehicle companies to invest in India, but the main beneficiaries of relevant policies may be Chinese companies.

India's central government approved a new policy this month to allow conditional tariff relief on imported foreign electric vehicles, the Hindustan Times reported. The policy proposes that import tariffs will be reduced to 15 per cent for electric vehicles priced above $35,000, provided that the car companies use the reduced tariffs to invest in electric vehicles in India.

The policy is similar to what Tesla CEO Elon Musk proposed during a meeting with Indian Prime Minister Narendra Modi in June 2023. But Indian think tanks believe that Chinese companies could also benefit from the policy. Mg Motors, owned by China's SAIC Motor, has reportedly partnered with India's JSW Group to sell electric cars in India. Byd and other Chinese car companies are also participating in the Indian market through vehicle exports and other ways.

The report said that the Indian government's policy support and private sector efforts to promote the country as a manufacturing hub for electric vehicles could lead to a sharp increase in reliance on Chinese auto parts exports. Chinese companies dominate many parts of the automotive industry chain, especially electric vehicles, and nearly a quarter of India's auto parts imports now come from China. The report warns that the Indian government and industry stakeholders need to carefully manage the risks of dependence on foreign manufacturers and potential trade imbalances. "In the next few years, a third of the electric vehicles on the roads in India and many passenger cars and commercial vehicles are likely to be produced by Chinese companies in India or in joint ventures with Indian companies." The founder of the think tank believes that given the advantages of Chinese enterprises in power batteries and other aspects, even if non-Chinese car companies open stores in India, they will still significantly increase their supply chain dependence on China.

Declaration: This article comes from the Global Times.If copyright issues are involved, please contact us to delete.

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