Trump labels Tesla's India factory plan as 'Unfair' amid high tariffs

In a recent development on Tesla's potential entry into the Indian market, U.S. President Donald Trump has voiced concerns over the implications of the electric vehicle giant establishing a factory in India to bypass the country's high import tariffs. Speaking alongside Tesla CEO Elon Musk during an interview with Fox News' Sean Hannity, President Trump described such a move as "very unfair."

President Trump emphasized the challenges Tesla faces in penetrating the Indian market due to significant import duties, which stand at around 100% on electric vehicles- a measure intended to protect domestic automakers like Tata Motors. This sentiment follows Prime Minister Narendra Modi's recent visit to the U.S., during which Trump highlighted the issue of high tariffs on American cars but committed to working towards resolving these trade barriers.

In March, India introduced an updated EV policy that reduces import taxes to 15% for automakers that invest at least $500 million and establish a local manufacturing facility. Despite this initiative, Trump's remarks suggest that any Tesla factory in India would still be seen as disadvantaging the U.S.

Elon Musk's company has signaled a potential entry into the Indian market, reportedly planning to open showrooms in New Delhi and Mumbai and hiring for key positions. However, Tesla has yet to commence manufacturing operations in India, facing obstacles related to regulatory conditions and investment requirements.

Trump's proposed reciprocal tariff strategy could escalate trade tensions globally by imposing equivalent tariffs on countries that tax U.S. imports. He contends this approach can force other countries to reconsider their tariffs on American goods.

India's response to these statements is pending, while Tesla's official timeline for its Indian launch remains under speculation.