New Delhi: Prime Minister Narendra Modi and tech entrepreneur Elon Musk spoke on Friday to advance discussions around potential investments by Musk’s companies, including Tesla and Starlink, in India. Their conversation builds on a prior meeting held in Washington earlier this year.
PM Modi described the interaction as promising, emphasizing the “immense potential” for collaboration between India and the United States in the fields of technology and innovation. He reiterated India’s commitment to strengthening partnerships with the US in these areas. The conversation was confirmed in a post on X (formerly Twitter), a social media platform owned by Musk.
The conversation comes amid escalating tensions between the United States and China, who are currently engaged in a major trade war. The US has imposed sweeping tariffs of up to 245% on Chinese exports, while China has retaliated with a combined 125% tariff on US imports. These punitive measures have rattled global supply chains, especially in the tech and auto sectors, as both countries are leading manufacturing hubs.
With many US tech firms dependent on Chinese manufacturing, India is increasingly being viewed as a strategic alternative for companies looking to diversify production. India’s growing manufacturing capabilities, especially in electronics and electric vehicles (EVs), make it an attractive destination. Tesla is among the companies evaluating this shift.
Although Tesla has not officially launched in India, signs of progress have emerged. Following Musk’s meeting with PM Modi in February, Tesla began hiring in India, posting at least 13 job openings on LinkedIn for various technical and customer-facing roles.
Historically, high import duties had been a deterrent for Tesla. However, in March last year, the Indian government addressed this by offering reduced import duties on electric vehicles, contingent upon a $500 million local manufacturing investment. Additionally, the Union Budget 2025 slashed basic customs duty on high-end vehicles (over $40,000) from 110% to 70%, a move seen as a signal to global EV manufacturers, including Tesla.
The recent US-China trade fallout may further accelerate Tesla’s India plans, as exporting from China now poses financial and logistical risks.
Elon Musk also has his sights set on expanding Starlink, his satellite internet venture, into India. With over a billion active internet users and one of the world’s largest digital markets, India is a key target for Starlink’s global expansion. However, regulatory concerns, national security issues, and opposition from domestic telecom giants like Reliance Jio have delayed its entry.
India’s telecom minister, Jyotiraditya Scindia, had previously stated that Starlink would need to meet all security and licensing norms before receiving approval. Initially, Musk criticized India’s spectrum auction model, but the government later revised its policy to allow satellite spectrum allocation without auction.
Still, challenges remain. Starlink’s premium pricing could face resistance in India’s ultra-competitive market, where data costs are among the lowest globally. The satellite broadband space is already dominated by players like Reliance Jio and Airtel.
With more than 7,000 Starlink satellites in orbit and around 4.6 million global users, Musk’s ambitions in India could mark a significant step forward in US-India technology collaboration. As global supply chains shift in the wake of the US-China trade war, India is increasingly being seen as a key player in the next chapter of global manufacturing and innovation.
