Elon Musk Accelerates Starlink and Tesla’s Entry into India Amid Shifting Trade Dynamics

Elon Musk is fast-tracking the entry of his satellite internet service Starlink and electric vehicle giant Tesla into the Indian market as trade relations between the U.S. and India improve. Analysts believe Musk’s growing influence in Washington could benefit his ventures as the two nations work to overcome trade barriers.

Recently, India’s leading telecom operators, Reliance Jio and Bharti Airtel, announced partnerships to facilitate Starlink’s entry into the country. Gwynne Shotwell, President and COO of SpaceX, expressed optimism, stating, “We are looking forward to working with Jio and receiving authorization from the Government of India to provide more people, organizations, and businesses with access to Starlink’s high-speed internet services.”

Starlink’s entry into India had faced delays due to uncertainties around spectrum allocation. Jio and Airtel, which control 74% of India’s internet service market, initially resisted the government’s plan to allocate satellite spectrum at fixed prices. They preferred auction-based distribution, similar to the method used for terrestrial spectrum, to raise barriers for Starlink’s entry.

However, the partnerships with Starlink suggest a strategic shift, as the government appears firm on its stance. Industry experts like Neil Shah from Counterpoint Research described the collaboration as a “truce,” indicating that all players will need to share the expanding market.

Meanwhile, Tesla has taken a significant step toward entering India by securing a five-year lease for a 370-square-meter showroom in Mumbai at a monthly rent of 3.5 million rupees (about $40,500). The company has also advertised multiple sales and customer support roles in the country.

Previously, Musk had cited India’s steep import tariffs—ranging from 70% to 100%—as a deterrent. Although the Indian government announced a reduced 15% customs duty for electric vehicles priced above $35,000 if manufacturers invest $500 million in local production within three years, the U.S. is pushing for the complete removal of import duties.

This demand poses a challenge for domestic carmakers like Tata Motors and Mahindra & Mahindra, which have pledged over $2 billion to develop electric vehicles. Analysts believe Musk’s ties with former U.S. President Donald Trump could further influence India’s decision-making.

India’s trade ties with the U.S. are strengthening, with American imports from India reaching $87.4 billion—more than double U.S. exports to India. As pressure mounts for India to balance this trade gap, Musk’s ventures could be pivotal.

However, experts like Ajay Srivastava from the Global Trade Research Initiative warn that offering special concessions to companies like Tesla and Starlink may discourage future investors from committing to local manufacturing. “India should prioritize strengthening domestic manufacturing over offering special treatment to foreign firms,” he argued.

Musk’s expanding business interests in India contrast with the nation’s past restrictive policies toward foreign companies. Notably, India’s 2019 regulations limited direct-to-consumer sales by foreign e-commerce giants, reshaping the operations of Amazon and Walmart-owned Flipkart.

Moreover, Musk’s social media company X (formerly Twitter) previously faced a legal battle against India’s censorship regulations, resulting in a $61,000 penalty—a case that was later dismissed.

Despite these challenges, Starlink and Tesla’s potential entry into India marks a significant step in the government’s efforts to position the country as a global business hub. As New Delhi courts investment from Musk, Apple, and other major players, the future of India’s trade and manufacturing landscape appears poised for transformation.