Karnataka Chief Minister B.S. Yediyurappa today announced that “American firm Tesla will open its electric car manufacturing unit in Karnataka.” The Karnataka chief minister also announced that the Karnataka government will also set up an industrial corridor in the Tumkur district, Bengaluru at the cost of Rs. 7,725 crore.

The statement came as a release where the Karnataka Chief Minister listed the benefits for his state under the Union Budget 2021. The news of Tesla opening its electric car manufacturing unit comes after it set up a subsidiary named Tesla India Motors and Energy PVT. LTD in Bengaluru in January. The company’s leased office is at Lavelle Road which is known as Bengaluru’s business district. According to a Registrar of Companies (RoC) filing, Musk set up the Indian arm of his company with a paid-up capital of Rs. 1 lakh and an authorized capital of Rs. 15 lakh.

Earlier, last month, Gaurav Gupta who serves as the Principal Secretary, Commerce & Industries of Karnataka spoke to news agency Mint where he said that “We have been interacting with Tesla for the last few months and it is happy news that they have decided to incorporate their company here. We have impressed upon them that Bengaluru is not only the technology capital but also the aerospace and space capital. For any kind of technology collaboration, it has the right kind of talent pool.”

The rumblings of Tesla making its way to India started in December 2020 when Nitin Gadkari, Union road transport and highways minister, confirmed that Tesla would be beginning its operations in India early in 2021. He also added that the company would start off gradually by offering its sales services, and eventually start assembling and manufacturing their electric cars in India.

Tesla CEO Elon Musk had earlier hinted at Tesla hitting the Indian streets on Twitter earlier. Tesla Club India tweeted a picture with a shirt saying “India Wants Tesla” and the caption asking Musk if there had been any progress regarding Tesla’s India chapter. Musk replied on it hinting that Indians can get their hands on a Tesla, sooner rather than later.

Later when the Electric-vehicle giant registered its subsidiary office in Karnataka, news also broke that the company minted  Vaibhav Taneja, Venkatrangam Sreeram and David Feinstein as the new directors of its Indian business arm.

The news of Tesla entering in the Indian market comes when the electric vehicle market is nascent. The Indian government is also ramping up the efforts of shifting the focus of Indian consumers towards electric cars. The choice of Tesla setting up shop in Bengaluru is also a commendable strategic choice as it houses the biggest clusters of technical pool in India. The Silicon Valley of India also hosts the R&D units of the biggest automobile names such as Mercedes-Benz, General Motors, Mahindra & Mahindra, Volvo, etc.

Karnataka also serves as being the headquarters of several electric vehicle startup companies including, Mahindra Electric, Pravaig and more. If Tesla goes on to set up an R&D unit in Bengaluru, it is sure to benefit from the IT, engineering and design talent pool.