THE Indian unit of Volkswagen AG (VW) has thrown its support behind Tesla Inc.’s push for a tax cut on electric vehicle (EV) imports, saying a reduction in tariffs would help the entire industry.

“Cutting duties on EVs even to 25 percent from the current levels which are as high as 100 percent wouldn’t pose a threat to domestic players, but would help to drive investment and speed up creation of the ecosystem,” Gurpratap Boparai, the managing director of Skoda Auto Volkswagen India Pvt., said in an email.

Tesla last month urged India to cut tariffs on EVs, with chief executive officer Elon Musk later tweeting he’d be “quite likely” to build a factory in the country if the U.S. carmaker can first begin selling imported vehicles.

While India’s government has poured cold water on the proposal, other auto executives including Mahindra & Mahindra Ltd. CEO Anish Shah and Hyundai Motor India Ltd.’s Seon Seob Kim have also backed the move.

India’s high-tax regime has long been a sticking point for foreign automakers. Toyota Motor Corp. last year said it won’t expand further in India due to high tariffs, while Harley-Davidson Inc. exited the nation. General Motors Co. pulled out of the country in 2017. (SD-Agencies)