Elon Musk who has been trying to enter the Indian electric vehicle and broadband markets through his business ventures, Tesla and Starlink, may find it easier to get regulatory support in India with the backing of the newly elected US President Donald Trump.
Over the past few years, Musk has shown interest in launching his businesses in India but has not received adequate policy support. For instance, he had planned to launch Tesla electric vehicles in India a few years back but faced hurdles due to the high import duty. Local players including Tata Motors and Mahindra & Mahindra have been vocal in opposing any relaxation for Tesla.
On the other hand, India has been negotiating with Musk to set up a local manufacturing unit. According to earlier reports, Musk was supposed to visit India in April this year to meet Prime Minister Narendra Modi to make an announcement on plans to invest and open a new factory in the country. The government also lowered import taxes on vehicles from foreign carmakers that pledge to invest in local manufacturing. However, so far a concrete deal has been elusive.
Similarly, Musk is keen to launch his satellite broadband services firm Starlink in India and has been asking for lower entry barriers. Starlink has asked the telecom regulator to charge a nominal fee of just 1 per cent of the annual revenues as spectrum charges. This is being opposed by Reliance Jio as it sees Starlink as a potential threat to the traditional telecom business.
Experts said that now that Musk will probably be part of Trump’s A team, he may be in a better position to negotiate a better deal. “So far Musk was just another businessman from the US. Now with Musk playing a key role in getting Trump re-elected, the equation has changed. Trump is known for his aggressive stance on supporting American businesses so he will back Musk to demand easier regulations from India,” said an industry observer.
“Given the sheer share of effort Elon Musk put into Trump, we can expect a smooth passage for his companies including Tesla to India,” said Llyod Mathias, a business strategist.