The Commerce and Industry Ministry on Tuesday referred to the Foreign Direct Investment policy and clarified that it is not correct to say that the policy mandates any company — in this case US-based electric car major Tesla — to conform to any minimum sourcing of local components if it wants to establish a manufacturing unit in India.
The Ministry was responding to reports on launch plans of Tesla in India being delayed, and a tweet by Tesla founder Elon Musk that "Maybe I'm misinformed, but I was told that 30% of parts must be locally sourced and the supply doesn't yet exist in India to support that."
