The Indian government has cautioned Tesla on building vehicles in China and importing them into India, according to Reuters.
Rather, the government has suggested that Tesla set up shop in India to make cars and export them, but importing them from China may be a red flag to government officials.
During a government conference, Minister Nitin Gadkari said, “Making in China and selling here is not a good proposition.”
India to Tesla: Buy $500 Million in Local Car Parts, If You Want Lower Taxes https://t.co/NW7gmHQDdG
— TeslaNorth.com (@RealTeslaNorth) February 16, 2022
The news comes after Tesla lobbied the country for lowered import duties for months, before the automaker’s proposal for tax breaks was rejected by the government in February.
By January, the talks between Tesla and the Indian government had hit a “weird stalemate situation.”
Last August, India told Tesla it wanted to see sourcing plans and a business roadmap before considering tax breaks.
Indian officials have reiterated the government’s wishes that Tesla would build a factory in the country, even saying that India could offer Tesla the lowest production costs in the world if it were to build a factory there.
Elon Musk’s other company SpaceX was asked to halt its Starlink efforts in India immediately, before the company’s Country Head resigned and before SpaceX refunded Starlink pre-orders in the country.
