India may soon slash EV import tariffs as Donald Trump seeks to impose levies — Here's what we know

India is planning to slash import duties on electric vehicles even as it rejects requests from domestic EV makers to delay such moves by four years. This comes as New Delhi plans to close a trade deal with Washington DC.

According to a Reuters report quoting sources familiar with the development, India is serious about cutting EV tariffs. This comes despite automakers supporting the Modi government to delay any cut in EV tariffs until 2029.

But India is prioritising the EV tariff cuts over domestic carmaker demands, with the levies riling US President Donald Trump and his billionaire Tesla CEO ally Elon Musk.

According to the report quoting two government officials, electric vehicle industry is set to be part of the first tranche of tariff reductions in a planned bilateral trade deal.

‘Significant’ reduction in EV tariffs

“We have protected the auto industry for far too long. We will have to open it up,” one of the government officials told Reuters. The source further revealed that EV tariffs will be cut ‘significantly’ among other products.

The officials did not elaborate or disclose the size of the planned duty cut given ongoing negotiations with Washington.

Tariff cut to build India-US tie

New Delhi's plan to cut duties on EVs and other goods comes as it seeks to build bridges with Trump - who has referred to India as a "tariff king" - even as he prepares to announce reciprocal tariffs on trading partners later on Wednesday.

An immediate cut would be a victory for Tesla, which has finalised showrooms in Mumbai and New Delhi to begin selling imported cars in the South Asian nation this year. Trump has said it is currently "impossible" for Tesla to sell in India and it would be unfair if it had to build a factory there.

But it would be a setback for domestic players like Tata Motors and Mahindra & Mahindra, which have invested millions of dollars in local EV manufacturing, with more to come, and lobbied against duty cuts.

Automakers fear any agreement with the U.S. would set a precedent for ongoing trade talks with the European Union and Britain, intensifying competition in India's small but fast growing EV sector, three of the sources said.