Chinese electric car maker BYD likely to drive into Telangana with first plant in India

Chinese electric car maker BYD is likely to drive into Telangana with its first plant in India if the Centre gives the go ahead to the project.

All available indications suggest BYD (Build Your Dreams) whose imported cars have been turning heads in the Indian market for some years now could well be settling for Telangana to locate the plant, atleast two officials in the know in the State government said.

It is expected to be a mega project given the expected investment and will also spur growth of an ecosystem of component makers and created thousands of jobs. BYD’s electric car project arguably will be one of the largest investments Telangana will bag across industries.

A top source in the State government confirmed “BYD is on” and the project will move forward once India and China give necessary clearances. “A soft green signal has been given in the backdrop of Centre seemingly looking to attract Chinese investments in near future,” the source said wishing anonymity.

The road ahead for BYD coming to Telangana will first depend on Foreign Investment Promotion Board (FIPB), the inter-ministerial body responsible for processing of FDI proposals and making recommendations for government approval, giving its nod.

Gujarat is the other major State followed by Tamil Nadu and Maharashtra, the last two being major automobile manufacturing hubs, vying for the project, an official said. Factors expected to work in Telangana’s favour are the State emerging as an early mover on electric mobility space, progressive policies as well the central location making it easier to ship vehicles to markets across the country.

Telangana government stood to benefit from improvement in Indo-China ties and entry of BYD could pave way for more Chinese firms set up facilities. “It all depends on how quickly the situation between the two countries improves,” the source said adding Telangana government was keen on rolling out red carpet to prospective big investors but will not move unless it hears from the Central government.

It will not be first time BYD proposal will go before the Centre as previously there were talks of the company collaborating with a leading infrastructure development firm based in Hyderabad for its electric car plant in India.

Sources said BYD’s entry into India was much talked about for the past couple of years but the Galwan Valley clash and the subsequent souring of relations between India and China had put on hold any such plans.

On Friday BRS leader and former minister for Industries K. T. Rama Rao took to social media saying “Finally! another long term plan coming to fruition. The 10 billion dollar investment proposal of BYD and [electric bus firm] Olectra that was negotiated and agreed upon, way back in 2022-23, was stalled due to foreign policy decision at the Union government.”

On the likely location of the plant in Telangana, an official said the State government had about two years ago shown to the company 200 acres for the project in Chandanvelly. The site will be near Olectra’s electric bus plant, a project in partnership with BYD.

Another official did not rule out a new location in the proposed manufacturing hub between Outer Ring Road and Regional Ring Road. Telangana, which under the A. Revanth Reddy-led Congress government, is on a massive overdrive to invite global investors is likely to be flexible with regard to location. Land availability is one of the strong points of Telangana, something the Chief Minister has been highlighting along with the other pro-business measures in his interactions with business leaders.

Highly placed sources in the Chief Minister’s office maintained Telangana government has put in place certain parameters to handle the investors and make their entry into the country and particularly the State a smooth affair. “Land is not an issue at all and the government had put in place a strict check list to provide the necessary infrastructure for the companies to come to Telangana,” the source said.

“BYD is not a conventional manufacturing company. Its sophisticated technology and extensive use of digital technology will make it easy to operate out of Telangana,” an official exuded confidence. Among established players in the automobile industry, Mahindra is the only one with manufacturing facility in Telangana at Zaheerabad, where it also makes electric fleet vehicles.

The buzz around BYD project comes at a time when Elon Musk’s Tesla is also actively considering entering India.