“Immense Potential For…”: PM Modi, Elon Musk Communicate Amid US-China Commerce Warfare
New Delhi:
Prime Minister Narendra Modi and tech billionaire Elon Musk spoke as we speak a few US-India partnership within the areas of know-how and innovation. The 2 leaders, who had met in Washington earlier this yr, took ahead their dialogue, together with about Mr Musk’s auto and tech companies – like Tesla and Starlink – investing in India.
There may be “immense potential” for collaboration between India and the US in these fields, PM Modi stated, including that India stays dedicated to advancing a partnership between New Delhi and Washington in these domains.
“Spoke to Elon Musk and talked about numerous points, together with the subjects we coated throughout our assembly in Washington DC earlier this yr. We mentioned the immense potential for collaboration within the areas of know-how and innovation. India stays dedicated to advancing our partnerships with the US in these domains,” PM Modi wrote on his social media deal with on X – one other agency owned by Elon Musk.
TIMING OF THE PHONE CALL
The telephone name between PM Modi and Elon Musk comes at a time when the US and China are engaged in a fierce commerce warfare, with both nation imposing punishing tariffs on the opposite – 245 per cent on all Chinese language exports to the US and 125 per cent retaliatory tariff over and above its beforehand current 67 per cent tariff by China on all US imports.
These tit-for-tat reciprocal and retaliatory tariffs have had a extreme influence on trade, since China and the US are the 2 largest manufacturing nations globally. Most of America’s high tech companies manufacture a overwhelming majority of their merchandise in China, and tariffs have despatched tech sector bosses looking for alternate locations to fabricate their items.
India, which has a longtime manufacturing sector within the tech and auto trade, and faces 26 per cent reciprocal tariff imposed by President Trump, is now being seeing as a beneficial various for tech companies to gravitate in direction of. For Elon Musk’s Tesla, the story is not any totally different.
TESLA’S JOURNEY IN INDIA
Tesla has not formally ventured into the Indian market but, however shortly after a gathering between PM Modi and Elon Musk in Washington in February this yr, Tesla Inc, the EV producer specializing in renewable vitality, had commenced hiring in India. The model had posted 13 openings on LinkedIn for numerous roles, together with back-end jobs and customer-facing roles.
Previously, Tesla and India have had an unsure relationship with the model delaying its entry into the Indian passenger automobile market. The main concern for the EV producer has been the excessive import duties. Nonetheless, the Indian authorities addressed the issues in March final yr with reductions within the import responsibility on electrical automobiles. This alteration got here with situations. For example, the businesses are required to arrange native manufacturing amenities with a minimal of $500 million in investments.
Within the Union Price range 2025, India diminished fundamental customs responsibility (BCD) on high-end automobiles with a price ticket of greater than $40,000 from 110 per cent to 70 per cent. This was seen as an invite for producers like Tesla.
However after April 2, 2025, when President Trump introduced reciprocal tariffs on nations that tariff US items “unfairly”, a retaliation by China quickly spiralled right into a commerce warfare between the 2 largest economies. Every nation outdoing the opposite over a sequence of punitive taxes on imports from the opposite.
The influence of those tariffs despatched shock waves by means of the manufacturing and logistics sector, together with the car and know-how sectors. Entrepreneurs like Elon Musk, who put all their eggs within the China-basket now face an unsure future by way of exports out of China.
STARLINK COMING TO INDIA?
Elon Musk, who overtly calls himself a “massive fan” of PM Modi, has bold plans for his Starlink satellite tv for pc web service to return to India, a rustic that leads the world in web consumption, and is the largest international marketplace for social media and fintech sectors.
Nonetheless, Starlink’s entry into India has confronted regulatory challenges, safety issues, and opposition from home telecom giants like Mukesh Ambani’s Reliance Jio.
In November final yr, India’s telecoms minister, Jyotiraditya Scindia, said that Starlink had but to adjust to safety norms, and a license for satellite tv for pc communications companies would solely be issued after assembly all necessities.
Elon Musk has criticised India’s coverage of granting spectrum for satellite tv for pc companies by means of auctioning, however the Indian authorities later modified its coverage, deciding to assign satellite tv for pc spectrum as an alternative of auctioning it.
India’s satellite tv for pc broadband service market is extremely aggressive, with no less than six corporations controlling the market, led by Ambani’s Reliance Jio and Sunil Bharti Mittal’s Airtel.
Greater than 7,000 energetic satellites of Mr Musk’s Starlink are orbiting Earth, offering low-latency broadband to some 4.6 million folks worldwide. Nonetheless, if Mr Musk desires to enter the Indian market – with greater than a billion web energetic web connections each day, Starlink’s excessive pricing may turn out to be a difficulty. India at the moment has one of many most cost-effective charges of cell information globally.
