A Tesla Model X at the company’s showroom in Shanghai. In May, Elon Musk flagged concerns about India’s local sourcing norms before the government clarified some of them in a tweet. Image Credit: Bloomberg

New Delhi

India is still open to Tesla Inc setting up operations in the country, even though the electric-car maker has chosen China for its first plant overseas.

“If they are coming, if they are ready to come, we will welcome, we are ready to offer them land and all type of help,” Transport Minister Nitin Gadkari said in an interview. “Presently Tesla doesn’t have any proposal to come to India,” he said. Palo Alto, California-based Tesla declined to comment.

Tesla, which last year picked China for its first assembly plant outside of California, had held months of public and private discussions with India before opting for the Chinese site. Chief Executive Officer Elon Musk had discussions with Indian officials — some of them made public in Twitter posts — about the nation’s policies on manufacturing and import of electric vehicles.

Prime Minister Narendra Modi on Tuesday told the World Economic Forum in Davos that India is removing red tape and laying out the red carpet for global investors.

Responding to a question of whether India lost out on an opportunity with Tesla, Gadkari said it was a decision for the company to make. “I requested them, I met them in America, but their first point was China at that time,” he said on Tuesday in New Delhi.

Musk said in June his company is in discussions with the government of India requesting temporary relief on import penalties or restrictions until a local factory is built. In May, Musk flagged concerns about the country’s local sourcing norms, before the government clarified some of them in a tweet.

Modi’s Make in India campaign envisages creating the world’s next manufacturing hub by encouraging domestic and foreign companies to set up factories locally. Tesla’s decision also comes as India pursues Modi’s ambition for all new car sales to be electric models by 2030 as part of a plan to combat climate change. That target is being seen by carmakers as a tough one to achieve because of lack of charging infrastructure and limited manufacturing capabilities of local companies.

Gadkari sees this scenario changing rapidly. A change in the tax structure for electric and alternative fuel vehicles will lead to a shift to environment-friendly cars, he said.

“I feel we don’t need any deadline,” Gadkari said. “In two years, you will see the miracle.”