Electric carmaker VinFast seeks import duty cut in India

DNHN - VinFast India CEO Pham Sanh Chau highlights that a temporary import duty cut will facilitate the introduction of VinFast products to Indian customers.

Electric carmaker VinFast is seeking a two-year import duty cut from India for its car products to help familiarise customers while its factory in the country is being built, Reuters reported.

VinFast India CEO Pham Sanh Chau told Reuters that VinFast has started building the factory in the southern Indian state of Tamil Nadu and expects to start production by the middle of next year, initially for the domestic market and later for exports.

VinFast’s investment plan in India has drawn attention, with the company and the Tamil Nadu government recently announcing a cooperation investment agreement worth up to $2 billion. As part of the deal, VinFast plans to commit $500 million for the first phase of the project.

“Besides, the project will boost the development of green transportation, which is a key agenda of the Indian government and states to decarbonise the transport sector, aiming for 30 per cent of new private cars registered to be electric,” Mr Chau added.

VinFast India CEO Pham Sanh Chau emphasised the importance of a temporary import duty cut to facilitate the introduction of VinFast products to Indian customers. He has proposed a reduction of around 70-80 per cent for two years for a limited number of cars. The executive highlighted the need for customers to become familiar with VinFast products during this transition phase.

Mr Chau added that the Indian government is considering the request. While awaiting a final decision, VinFast will continue to build its manufacturing facility.

The plant in Thoothukudi, Tamil Nadu, is scheduled to roll out its first car by mid-2025. From there, exports will also be shipped out, depending on demand from overseas markets.

Apart from zero emissions during usage, VinFast also aims to minimise emissions during production.

The area where the factory is being built is known as the “windmill capital” of India, with optimum wind speeds throughout the year, according to The Hindu. As such, VinFast is likely to install windmills to generate “green” energy for its manufacturing process.

With the VinFast tie-up, Thoothukudi becomes Tamil Nadu’s third auto hub after Chennai and Hosur, and Tamil Nadu is the only state in India to have three auto hubs, The Hindu reported.

Last year, electric vehicles accounted for 2 per cent of car sales in India. The federal government has set a target of 30 per cent by 2030 and is rolling out programmes to attract EV makers to the market.

Thu Tra