Days after Tesla began hiring staff in India, signaling its potential market entry, former U.S. President Donald Trump expressed his discontent over the EV giant’s plans to establish a manufacturing unit in the country. Speaking during a joint interview with Tesla CEO Elon Musk on Fox News, Trump labeled the move as “very unfair” to the United States. He argued that countries like India impose high tariffs on American imports while benefiting from the U.S. market. Trump’s remarks follow his earlier criticism of India’s car import duties, which were raised during Prime Minister Narendra Modi’s recent visit to Washington. He insisted that such trade imbalances put American companies at a disadvantage, reinforcing his stance on implementing reciprocal tariffs to counter foreign levies on U.S. goods.
India, in an attempt to attract foreign investments in the EV sector, recently introduced a new policy reducing import taxes to 15% for automakers willing to invest at least $500 million and establish local manufacturing facilities. This policy shift came after years of lobbying by Tesla, which had previously hesitated to enter the Indian market due to high tariffs and regulatory challenges. While Tesla has already begun scouting locations for showrooms in Mumbai and New Delhi, Trump’s criticism could impact the company’s India expansion strategy, especially given the uncertainty surrounding future trade relations between the two nations. With Tesla yet to manufacture vehicles in India, the policy changes are expected to ease the company’s entry, but political factors may still play a significant role in shaping its operations.
Beyond Tesla, Trump’s broader tariff strategy poses potential risks of escalating global trade tensions. His proposed policy aims to impose reciprocal tariffs on countries that levy high duties on American products, a move that could disrupt international trade dynamics. During the interview, he reiterated that the U.S. should mirror foreign tariff policies to level the playing field, warning that failure to do so allows other nations to exploit the American market. With Tesla’s India plans now under scrutiny and Trump’s tariff threats looming, the situation could evolve into a larger geopolitical and economic debate, affecting not just Tesla’s business prospects but also U.S.-India trade relations in the long run.
