The Apple playbook for Tesla

The tech giant learnt the hard way that patience, negotiating flexibility and industry cooperation work better than public statements and tweets when attempting to enter India

- SURAJEET DAS GUPTA

Tesla's tryst with India is clearly not going as smoothly as it may have expected. That is why last week, two years after Elon Musk first announced that his company would come to India, then registering a firm in Bengaluru to import cars and holding discussions on setting up company-owned retail showrooms, the maverick entrepreneur's terse Twitter response to a query was: “Still working through a lot of challenges with the government." Musk has made no secret through Twitter that India's import duties (60-100 per cent) on electric vehicles (EVS) are the highest in the world among large countries and the company has asked for a sharp reduction as a condition for entry. He has also complained that clean energy vehicles are treated on a par with petrol vehicles, which is inconsistent with India's climate goals.

Invitations from Telangana, Maharashtra and Punjab notwithstanding, Musk's demand for a sharp import duty cut has divided the auto industry. Domestic manufacturers such as Mahindra & Mahindra and Tata Motors, through industry lobby Society of Indian Automobile Manufacturers, have stated that a duty cut would be unfair when the government has set a high localisation threshold for Indian industry. But Musk has support from foreign carmakers who also want duty cuts. Government officials said Musk cannot demand duty reduction without committing to manufacturing in India.

Musk's problems with the government extend to Space X, which runs Starlink. The satellite broadband service provider was pulled up by the Department of Telecom (DoT) last month for offering Indian customers prebooking opportunities. DoT put out an advisory warning subscribers that Starlink didn't have a licence to operate, violating telecom rules.