The major development that is likely to happen in India very soon is Hyderabad-based Megha Engineering and Infrastructures Ltd. is eyeing to ink a contract for the manufacturing of around 75000 units of two models by assembling completely knocked down kits to avoid the import duty on the cars, for sale in India. Therefore, MEIL (Megha Engineering and Infrastructures Ltd) is said to be in conversation to assemble e6 and Atto 3 electric cars in India from BYD Auto Co. Ltd of China. This information was provided very reliable source. The report also suggested the plan of investment with the EV company has stalled. To unfold the details of MEIL’s assembling CKD kits and investment plan with the Chinese BYD Auto Co. Ltd, you need to go through this article till the end. Scroll down for more details.
According to the reports, Megha Engineering and Infrastructures Ltd based in Hyderabad is looking ahead to cut down the import duty by assembling fully built cars in India. In a bid to lower the import duty, Megha Engineering and Infrastructures Ltd invested $200 million in setting up 2 factories in India to assemble China’s BYD’s Atto 3 and e6. By assembling completely knocked-down kits to lower import duty than fully built cars from China to India, Megha Engineering and Infrastructures Ltd decided to set up two factories in India. For the unversed, the Indian government levies a 100 percent basic customs duty on fully built-up units of EVs that have a price of more than $40,000. Kindly note that India levies a 70 percent duty on fully built-up cars that have a price below $40,000.
Basic Customs Duty (BCD) is lower on semi-knocked-down and completely-knocked-down kits in comparison to the fully built-up units of EVs. The semi-knocked-down kits have a basic customs duty of 35 percent while the completely-knocked-down kits have 15 percent BCD. Sources aware of the deal said at a time its $1 billion investment plan with the EV giant has stalled.
Reportedly, Megha Engineering and Infrastructures Ltd is planning to start contract manufacturing 25,000 units and scale it up to around 75,000 units for sale in India. As mentioned, the assembling of the cars will take place in MEIL’s newly formed factories. The new plans come as the duo’s $1 billion investment proposal submitted to DPIIT (department for the Promotion of Industry and Internal Trade) for an equal JV (joint venture) is yet to secure approval.