Former US President Trump Questions Tesla’s India Plans, Calls for Reciprocal Tariffs
Former US President Donald Trump has voiced strong opposition to Elon Musk’s Tesla setting up a manufacturing plant in India, calling it “very unfair” to the United States. Trump criticized India’s 100% import tariffs on foreign vehicles, arguing that they make it “practically impossible” for US-based automakers like Tesla to sell cars in the Indian market.
Highlights from Trump’s Statement
- High Import Tariffs on US Cars: Trump emphasized that India imposes the highest import tariffs in the world, making it difficult for American car manufacturers to compete.
- Reciprocal Tariff Policy: He reiterated his plan to impose equal tariffs on Indian exports if he is re-elected, stating:
“Whatever you charge, I’m charging.”
- Discussion with PM Narendra Modi: Trump claimed he raised the issue with Indian Prime Minister Narendra Modi during a recent conversation.
- Impact on US Manufacturing: Trump suggested that allowing Tesla to build a factory in India would hurt the American auto industry and be unfair to US workers.
Tesla’s Expansion Plans in India
Despite Trump’s criticism, Tesla is accelerating its India entry strategy, signaling strong commitment to the Indian electric vehicle (EV) market.
- Tesla Job Listings in India: The company has posted job openings for positions in Mumbai, Delhi, and Pune, indicating an imminent market launch.
- Retail Presence in Major Cities: Tesla is reportedly planning to open showrooms in Mumbai’s Bandra-Kurla Complex (BKC) and Delhi’s Aerocity, according to CNBC-TV18.
- India Operations Timeline: The company is expected to start retail operations by April 2025.
Potential Impact of Trump’s Trade Policies on India-US Trade Relations
If Trump wins the 2024 US presidential election, his protectionist trade policies could have significant implications for India-US trade relations, especially in automobiles, electric vehicles (EVs), technology, and pharmaceuticals.
- Tariff War on the Horizon?: Trump’s reciprocal tariff strategy could increase import duties on Indian products such as automobiles, pharmaceuticals, and IT services, affecting India’s export-driven industries.
- Tesla’s India Strategy to Circumvent Tariffs: Tesla is likely to manufacture vehicles locally in India to bypass high import duties, aligning with the Indian government’s ‘Make in India’ initiative.
Conclusion
While Tesla’s India expansion appears to be progressing, Trump’s strong stance on trade protectionism and reciprocal tariffs could introduce new challenges for India’s trade policies. As Tesla moves forward with its manufacturing and retail plans in India, the global auto industry will be watching closely to see how the India-US trade dynamics evolve in the coming months.