Posts tagged: import duty

Last updated:February 21, 2025, 12:14 IST

New Ev Policy: Due to the new EV policy, the shares of Tata Motors, Mahindra & Mahindra and Hyundai Motor India declined by 6%. Preparations for Tesla's entry into India feared to increase competition for domestic companies …Read more

New ev policy: On 21 February, Tata Motors, Mahindra & Mahindra (M&M), and Hyundai Motor India shares saw a decline of up to 6%. This decline has taken place by the government amid discussion of relaxation in electric vehicles (EV) import rules. This step can make it easier for foreign companies to enter the Indian market, due to which there is a possibility of increasing competition for domestic automakers. Preparations for entry of global companies like Tesla into India have given this discussion further warm.

Mahindra & Mahindra shares saw the biggest decline in about 7 months, which reached ₹ 2,653. Tata Motors shares fell 2% to ₹ 676 and Hyundai Motor India shares fell 2.5% to ₹ 1,875. This decline is believed to be because Tesla has started fast efforts to sell his cars in India.

According to Moneycontrol report, Alan Musk's Tesla Inc. can enter the Indian market through direct imports, not through local production. To facilitate Tesla's entry into India, the government is considering a decrease in EV import duty. Apart from this, extensive exemption can also be given in EV import rules.

Change in import duty
The government has reduced basic custom duty (BCD) to 70 percent on fully prepared electric vehicles priced more than $ 40,000. However, an additional 40 percent of the Agriculture Infrastructure and Development Cess (AIDC) has been imposed. 10 percent of Social Welfare Surcharge (SWS) is exempted, resulting in an effective import duty for electric vehicles above this price point to 110 percent. The import duty for electric vehicles priced below $ 40,000 remains at 70 percent.

Reacts in the stock market
After this news, the Nifty Auto Index saw a decline of 2.5%, which reached 21,534 points. The decline in shares of major companies like Tata Motors, M&M, Hyundai Motor India, Maruti Suzuki and Bajaj Auto affected the index. The Nifty Auto Index has seen a decline of about 6% from the beginning of this year.

Possible changes in electric vehicle policy have shaken the Indian automobile sector. The entry of global companies like Tesla will increase competition in the Indian market, but it will also be a big challenge for domestic companies. This policy of the government is an important step towards making India a major player in the global EV market.