Elon Musk, the CEO of Tesla, has criticized India’s high automobile import taxes, which may reach 110%, as among the world’s highest.
Under a potential trade agreement between the two countries, the United States wants India to remove tariffs on auto imports. However, sources told the news channel that while the administration is considering more reductions, it is hesitant to instantly reduce such taxes to zero.
One of the three individuals informed of the subject stated that official negotiations for a bilateral trade pact that has not started will address India’s high car tariffs. This will open the door for American electric vehicle manufacturer Tesla, which is preparing for an India launch.
Elon Musk, the CEO of Tesla, has criticized India’s high automobile import taxes, which may reach 110%, as among the world’s highest. Last year, the EV behemoth abandoned its intentions to make a second foray into the world’s third-largest automobile market.
U.S. President Donald Trump frequently complained about India’s high taxes and backed Mr. Musk. In a speech to Congress on Tuesday, March 4, 2025, he blasted the nation’s vehicle tariffs of over 100% and threatened retaliatory action.
The first source said it was “clearer than any other” that New Delhi will remove vehicle tariffs. “The U.S. ask is for India to bring tariffs down to zero or negligible in most sectors, except agriculture,” the source stated.
According to a second source, India was “listening to the U.S.” and has not retaliated, adding that it will discuss its stance on the tariffs with local companies first.
Response requests were not answered by the Foreign Affairs Ministry, India’s Trade Ministry, or the office of the US Trade Representative.
