This is the title of a book written by Bill Gates in
1999 .
It contained some of the earliest hints of software
developments , aimed at speeding up businesses
That was long before tech community started talking
about Artificial Intelligence ( AI )
But 25 years later, some decisions are still being
taken @ speed of a snail
!
Context :
EV
policy to attract global players, help India become manufacturing hub: Experts
The government on Friday
approved an electric-vehicle policy, under which duty concessions will be given
to companies setting up manufacturing units in the country with a minimum
investment of USD 500 million, a move aimed at attracting major global players
like US-based Tesla.
Aligned with the government's
vision of reducing carbon footprint, promoting sustainable manufacturing, and
achieving net-zero emissions by 2070, the policy sets the stage for a vibrant
future-mobility global manufacturing hub in India, Marwah said.
ICRA currently expects about
15 per cent of new car sales to be electric by 2030, he added.
"Further, countries that
have been front-runners in EV adoption have also developed a local vendor
ecosystem. This policy is a step in the right direction and would aid in
increasing EV components localisation in India, which is currently at 30-40 per
cent," Dewan stated.
As per industry estimates, the
total EV sales in India stood at around 10 lakh units in 2022.
Centre approves game-changing EV policy: Tesla arrival
imminent .. TOI
Extract :
Key highlights of the policy include a
minimum investment requirement of Rs 4,150 crore (approximately USD
500 million), with no ceiling on the maximum investment amount.
Companies establishing manufacturing
facilities for EVs will be granted a three-year window to set up
operations in India and to begin production of EVs. Furthermore, within a
maximum period of five years, these manufacturers are mandated to achieve a 50
percent domestic value addition (DVA) during the manufacturing process. The
policy also says that a localisation level of 25 percent must be
achieved by the third year.
For the global players who intend to set up facilities in India, much like
Elon Musk-led Tesla, limited imports of EVs will be permitted at a lower
customs duty rate of 15 percent for vehicles with a minimum CIF (cost,
insurance, freight) value of USD 35,000. At percent, an import duty of 70
percent is levied on the electric vehicles falling under this
category.
However, this concessional rate will be
applicable only if the manufacturer establishes manufacturing facilities in
India within a three-year timeframe with an investment of USD 500 million.
Speaking of Tesla, the US-based marque has been asking for a reduction in
import taxes for a while now. Recently, another company VinFast from
Vietnam also said they want the import taxes to be lower.
The amount of duty not paid on all the EVs
allowed to be brought into the country will be limited to the money invested or
Rs 6,484 crore, whichever is less. Also, no more than 40,000 EVs can be brought
in each year, following specific rules. To make sure that companies follow the
rules of the scheme, the manufacturers will have to provide a bank guarantee
equal to the duty not paid, which will be used if they don't meet the specified
criteria for domestic value addition (DVA) and investment.
India okays EV policy with tax relief to rev up
manufacturing dream & lure foreign players like Tesla
Extract :
For vehicles with a minimum CIF (Cost, Insurance,
and Freight) value of $35,000, a 15% customs duty (as applicable to Completely
Knocked Down units) will be levied for a duration of five years, subject to the
manufacturer setting up manufacturing facilities in India within a 3-year
period. The duty foregone on the total number of EVs permitted for import will
be capped at the investment made or ₹6,484 crore (equal to incentive under PLI
scheme). Additionally, a maximum of 40,000 EVs, at a rate not exceeding 8,000
per year, will be allowed if the investment surpasses $800 million.
Manufacturers will be required to
establish manufacturing facilities in India within a three-year timeline and
commence commercial production of EVs. They must achieve a domestic value
addition (DVA) of at least 50% within five years. Moreover, a localisation
level of 25% by the third year is mandated.
Tesla
at the gates, India rolls out red carpet for global EV makers
Extract :
Minimum Domestic Value Addition :
Ø Third
Year ………………………………. 25 %
Ø Fifth
Year ………………………………… 50 %
Only EVs worth over $
35,000 ( approx. Rs 30 Lakh ) covered under the Scheme . Clubbing together
local taxes and markrting margins, such an imported vehicle is expected to
retail at closer to Rs 40 lakhs
According to Automobile
Industry data, more than 80 % of the Indian Car Market , or 3.2 million
annually, comprises cars retailing at less than Rs 15 lakh per unit
The total number of vehicles worth more than $ 35,000 a
unit, being sold in the country is about LESS THAN a lakh and about 1 – 1.5 %
of the total market
Sharply reduced rate of 15
% customs duty for upto 8,000 EVs annually imported by a company that commits
to Make in India
Carry over of any
unutilized annual import limits will be permitted
Joe Biden set to crack down on auto emissions to
accelerate EV sales .. ET
… 17 Mar 2024
Extract :
Emissions limits set to be finalised by the
Environmental Protection Agency within days would propel electric vehicle sales
well beyond current levels. The EPA has projected that to meet proposed
mandates, electric models would need to make up roughly two-thirds of car and
light truck sales in 2032 - up from less than a tenth last year.
The measure, which sets limits on smog-forming
pollution, soot and carbon dioxide emissions, is seen as one of the most
consequential climate regulations being imposed by President Joe Biden. It's also key to
helping the US fulfill its Paris Agreement commitment to at least halve the
country's greenhouse gas emissions by 2030. The transportation sector is the biggest source of
planet-warming pollution in the US today.
"Cars
and light trucks on their own are roughly 20% of
the carbon
footprint,"
said Manish Bapna, head of the Natural Resources Defense Action Fund. Cutting
that is "absolutely essential to real, concrete progress."
My Take :
After reading my following
e-mails ( to our Cabinet Ministers and to Elon Musk ) , if you feel that this (
dialogue between Govt and Musk ) has been more of a “ Sparring Game “ , you
cannot be blamed :
Ø Will
Tesla follow Apple ? …………………………….. 23 May 2017
Extract :
Govt has proposed to Apple , the following Phased Manufacturing Program ( PMP ) :
2017-18 :
Mechanics ,
Die-cast parts, Microphone and Receiver , Key Pad and USB cable
2018-19 :
Populated
Printed Circuit Boards, Camera Modules, and Connectors
2019-20 :
Display
Assembly, Touch Panels , Vibrator Motor and Ringer
Nothing revolutionary here to anyone who applied for an Industrial Manufacturing License , around 1970 !
And , even provide the figures of increasing “ local content ( by value ) “ in the selling price of the product proposed to be manufactured locally ( indigenization )
And even provide , figures of “ Anticipated Value “ of Import Licenses required for each phase ! And provide figures for components imported and products made / sold , each year !
One only hopes that what Govt
proposes to Apple is made
“ public “ on DIPP web site so that there is ,
· No
ambiguity ( no scope for arbitrariness / discretion )
-------------------------------------------------------------------------------------------
Dear
Elon :
2018-19
:
Manufacture in your own factory , Li-ion Battery / Wall-mounted Powerpack Storages / Solar Roof Tiles
2020-21
:
2021-22
:
Now , it is very
possible that neither Shri Gadkariji ,
nor Shri Goyalji , would be
satisfied with such a slow PMP , spread out over a period of 5 years
With regards,
Hemen Parekh
www.HemenParekh.ai / 10
May 2024
Related Readings :
2017 ( 7 )
Will Tesla follow Apple
?............................ 23 May 2017
ENABLE ELON TO CATALYSE ! ……………………………………..
15 June 2017
Welcome ! Elon Musk ……………………………………………… 10
Feb 2017
From ELON to ION ………………………………………………………….
11 May 2017
Is it NOW or NEVER ?
…………………………………………………….. 23 June 2017
Elon : Hesitation Can Hurt !
…………………………………………….03 July 2017
Elon : Widow Opens ( Door is not closed, either )………….
07 July 2017
A Phased Manufacturing Program ? …………………………….
23 Apr 2018
FAME II > FAME III > FAME IV ……………………………………..
05 Mar 2019
To beat OR not to beat ?........................... ………………. 29 Dec 2020
Fastest Finger First ?
…………………………………………………….. 07 Oct 2020
ARA & M Ltd ?
……………………………………………………………….. 02 Oct 2020
Enough to entice Elon ? …………………………………………………. 03
Nov 2020
The Race is on ! ……………………………………………
………………… 23 Oct 2020
2021 ( 12 )
Import Duties : Time to get Rational …………………………. 27
July 2021
Hey Elon , What is so difficult ?...........................
……. 15 Aug 2021
Elon : It is a matter of GIVE and TAKE…………………………..
30 Aug 2021
Tesla Talking ?........................................................ 29
Aug 2021
Hey, Elon seems to have a case !
…………………………………. 27 July 2021
Can TESLA beat MATAM ?
…………………………………………….. 24 July 2021
Cheaper in Gujarat ? – At least for Now ……………………….
23 June 2021
Nitin Gadkariji : Architect of NEAP…………………………
…….. 07 Jan 2021
A Brief History of Electric Vehicles in India …………………..
30 Jan 2021
Elon Musk : We offer a GREEN CARPET………………………….
03 Mar 2021
Elementary, my dear Watson ! ……………………………………..
17 Jan 2021
At long last, TESLA is here !
…………………………………………… 13 Jan 2021
2022 ( 2 )
ELON , You have missed the Bus / by 5 YEARS ……………15
Feb 2022
Holding out an Olive branch ? No, entire Olive Tree !... 17
Feb 2022
A push for endless litigation ?......................
……………..14 Nov 2023
Elon Musk, Welcome to Tesla’s Toughest Test………………
17 May 2023
Additional Reading :
Ø 50 % DAV
? No problem .. …………………………… 16 Nov 2023
Extract :
# As per Shri Goyal , in 2023 , Tesla is likely to import parts from India , worth $
2 billion
# As per news reports, to begin with, Tesla plans to import / sell in India , fully
assembled EV priced ( in
USA
# Let us assume $ 25,000 as FOB price , taking the CIF price to $ 30,000 ( with
freight / insurance added )
# Let us assume import duty (
proposed ) is 30 % on $ 30,000 = $ 9,000
# So , landed cost would come to $ 39,000
# Add to this “ distribution cost + dealer’s margin “ of 20 % ( ie . approx. $
8000 )
# Hence “ Net Selling Price “ would come
to $ 47,000
# To this , add GST @ 5 % ( ie. $ 2350 ) – taking the final price to $ 49,350 , on
the road ( ignoring
# Let us assume that , in each of the
first 2 years , Tesla sells 20,000 cars
# Hence its annual revenue would be > 20,000 x $ 50,000 ( rounded off ) = $
1,000,000,000 ( $ 1 Billion )
# Now , if Tesla purchases only $ 500 million worth of local components for its
India
operations , from 2nd year
Addition ) of 50 % !
Tesla is already buying $ 1 Billion worth of Indian Components ( for its USA +
Germany+
China, operations )
Buying $ 500 milllion worth of components from Indian suppliers for its Indian
factory, would pose NO
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