There has been a fresh development following a lot of assumptions that Tesla will soon come to India. In a response to a Tweet, Elon Musk, the CEO of Tesla, said on 13 January that the company is having "a lot of issues" in India with its car launch, but it is working with the government to address them.

A Twitter user asked Musk about Tesla, saying: “Yo @elonmusk any further update as to when Tesla's will launch in India? They're pretty awesome and deserve to be in every corner of the world!”

While responding to the tweet Musk stated that “still working through a lot of challenges with the government”.

It was reported earlier that Tesla has asked the Indian government to lower import levies on electric vehicles (EVs) before it joins the market, ramping up demands that have been met with resistance from some Indian automakers. The American EV giant plans to start selling imported cars in India this year, but the country's tariffs are among the highest in the world, according to the company. Several local players objected to the call for tax reduction, claiming that such a move would discourage investment in home manufacturing.

Late last year, Union Minister Nitin Gadkari stated that he has invited Tesla to come to India and manufacture the EVs in the country. At that time he also said the government will provide all required support for the production site. However, since then there has been no updates on that matter.

Prior to that, Musk stated that building a Tesla factory in India is only plausible if the imported cars receive a good response in the Indian market. The billionaire told a Twitter user on 24 July: “If Tesla is able to succeed with imported vehicles, then a factory in India is quite likely.”

The tax has been the main concern for Tesla. Musk had expressed reservations about releasing electric vehicles in India due to high import tariffs. It was reported that he has been hoping for a "temporary tariff relief” for EVs as Tesla continues to press for lower taxes before launching any models in India. Despite Tesla's demand for a reduction in import charges, Mercedes-Benz will begin manufacturing the electric version of its flagship S-Class sedan, the EQS, in India later in 2022, reports noted.

Imported cars are currently subject to customs duties ranging from 60 to 100 per cent in India. Fully imported cars with a CIF (Cost, Insurance and Freight) value of more than $40,000 are subject to a 100 per cent import charge, whereas cars that cost less than $40,000 are subject to a 60 per cent duty.

Last year, Tesla got homologation certificates—the process of certifying automobiles for roadworthiness according to government-set criteria for all vehicles manufactured or imported in the country—for four of its vehicle models. The EV manufacturer now has seven vehicles recognised in India because of three more certificates.