Musk says Tesla won't set up factory in India unless allowed to sell and service cars

Tesla has been desperate in recent years to import and sell its electric vehicles in India, which has been lobbied in New Delhi after CEO Elon Musk said India imposed almost the highest tariffs on electric vehicles in the world. For nearly a year, it was hoped that the country would reduce tariffs.

But Tesla's efforts appear to have stalled, as the company has yet to announce concrete plans to invest in India, which is inconsistent with the Prime Minister's "Make in India" vision to boost local manufacturing and create more jobs. Therefore, India prefers Tesla to build a factory in India instead of importing from China.

Tesla CEO Elon Musk said on Friday that it won't set up a manufacturing plant in India until it is licensed to sell and service cars in the country, TechCrunch reported. Embarrassingly, more than a year ago an Indian state said they planned to open a factory in the south of the country.

In response to a request on Twitter for an update on Tesla's manufacturing plant in India, Musk responded: "Tesla won't set up a factory anywhere that doesn't allow us to sell and service cars."

In fact, Tesla has been approaching the Indian government for more than two years to assess the electric car maker's path into the world's second most populous country.

The Indian government has insisted that Tesla open a manufacturing plant in the country to assemble cars locally, and if Tesla wants to sell cars, it will be subject to high import taxes.

On the other hand, the U.S. company is looking to lower tariffs in India to test the local market by selling cheaper imported electric vehicles before launching into a production base.

Early last year, Tesla set up a subsidiary in India and registered an office in the city of Bangalore, in the state of Karnataka. Soon after, the southern Indian state of Karnataka said Tesla "will open an electric vehicle manufacturing plant in Karnataka." But both companies are currently at a standstill.

"If Musk is going to make Teslas in India, then there is no problem," Nitin Gadkari, India's road minister, said last month, but added that cars are made in China and sold in India Not a "good idea".

In a tweet earlier this year, Musk said Tesla was "still dealing with many challenges from the government." Audi expressed similar concerns.

Several Tesla executives in India were recently transferred to Indonesia and other Asian countries, the Economic Times reported earlier this month.

In another tweet, Musk revealed to another user that SpaceX is awaiting approval from the Indian government to launch Starlink in India.

Last year, the company hired former PayPal executive Sanjay Bhargava to lead Starlink’s operations in India. He said the company briefly began taking reservations in India, with plans to deploy more than 200,000 active terminals in more than 160,000 locations in India by the end of December 2022.

Bhargava's resignation comes weeks after the Indian government ordered the SpaceX unit to stop taking equipment orders because the unit did not have a license to operate in the South Asian market.