Tesla’s entry into India’s EV market will be 'good news’ for the country, says MG Motor India

India's electric vehicle sector still lacks competition, but entry from international automakers like Tesla will level the playing field, MG Motor India's CEO Emeritus Rajeev Chaba said. 

"Competition is limited at this point of time. Numbers are still constrained because consumers don't have compelling choices," Chaba told CNBC's Sri Jegarajah in Gurugram, India. 

According to Bain & Company, EVs make up about 5% of India's automobile sector.

The Indian government's goal of achieving 30% EV sales by 2030 "looks stretched at this point of time," Chaba said — however, anywhere between 20% to 30% may be possible if there are more government policies attracting foreign automakers, he added.

"When India as a market gets attention, more and more players and investments will come in. [Tesla] will definitely help in developing the ecosystem and some consumers will go for them," Chaba said. 

Just last month, the government announced that import tariffs on certain EVs will be cut to 15% if the carmakers meet certain requirements. India currently imposes import tax of 70% or 100% for foreign EVs, according to Reuters.

According to India's new policy, automakers that invest at least $500 million and set up manufacturing facilities in India within three years, will be eligible to import up to 8,000 EVs that cost $35,000 or more a year, at a lower tax rate.

The move is good news for Tesla, which has been trying to break into the India market, and has been lobbying for lower import duties for years.

Domestic carmakers such as Tata Motors, Mahindra and Mahindra, as well as Maruti Suzuki, have reportedly expressed concerns before.

He also said: "I wish more and more players come, with more and more choices. Because that will give consumer a