According to a story published in the Economic Times on Friday, Tesla is prepared to invest up to $2 billion to establish a factory in India, provided that the government reduces the import duty on its vehicles to 15% for the first two years of operation.

According to a report by Reuters in August, India is developing a new electric vehicle (EV) policy that would reduce import duties to as low as 15%, from the current 100% on cars costing more than $40,000 and 70% on all other cars, in exchange for a pledge to support some local production.

According to the ET story, which cited unidentified sources, the Elon Musk-led electric vehicle (EV) manufacturer is prepared to invest up to $500 million if the government approves the reduced duty for 12,000 vehicles and up to $2 billion if the concession is for 30,000 vehicles.

According to the Economic Times, the government is considering whether to invest the $2 billion that Tesla has proposed, but it also wants to import fewer cars at a lower duty than what Tesla has proposed.

When Reuters reached out for comment, Tesla, the ministry of heavy industries, the ministry of road transport & highways, the ministry of finance, and the department for development of industry and internal commerce did not immediately answer.

(Adapted from EconomicTimes.com)