NEW DELHI, Feb 19 (Reuters) – The United States has maintained its position as the world’s strongest economy. President Donald Trump has said that if Tesla (TSLA.O), opens new tab were to build a factory in India to circumvent that country’s tariffs, it would be “unfair” to the U.S., in an interview with Fox News which aired on Tuesday.
Last week, during Prime Minister Narendra Modi’s visit to the United States, Trump criticized India’s high car tariffs. However, the two leaders reached an agreement to advance a trade agreement and resolve their tariff dispute.
Elon Musk, the CEO of Tesla, has long criticized India for its import tariffs of approximately 100% on electric vehicles (EVs). These tariffs are designed to safeguard local manufacturers, including Tata Motors, in the world’s third-largest auto market, where the adoption of electric vehicles is still in its infancy.
According to Trump, it is “impossible” for Musk to sell a car in the South Asian nation.
“Every country in the world takes advantage of us, and they do it with tariffs… It is impossible to sell a car, practically, in, as an example, India,” according to him.
In March, the Indian government implemented a new EV policy that significantly reduces import taxation to 15% for carmakers that invest a minimum of $500 million and establish a factory.
Tesla has posted job advertisements for 13 mid-level positions in India and has selected locations for two showrooms in the Indian cities of New Delhi and Mumbai, according to Reuters on Tuesday. At present, it does not produce any vehicles in India.
Trump stated that Musk’s decision to construct a factory in the United States would be “unfair” to the country.
“Now, if he constructs the factory in India, that is permissible; however, it is extremely unjust to us,” Trump stated during the interview.
A request for comment was not promptly addressed by India’s foreign ministry.
The potential for a global trade conflict with American allies and adversaries has been increased by Trump’s proposals to impose reciprocal tariffs on all countries that tax U.S. imports.
