Claims that the Elon Musk-led Tesla would be eligible for a duty waiver have been refuted by the Indian government. The statement coincided with rumours that Tesla was debating an investment plan to produce around 500,000 electric vehicles yearly at a nearby factory. While Tesla had earlier stated it wants to start with exports in order to gauge the level of demand, India is still eager for the business to start producing cars there.

Sanjay Malhotra, Revenue Secretary said while speaking to press, “Any duty waiver for Tesla is not under active consideration of the Department of Revenue, as of now.”

The government’s refusal to decrease import levies on the US automaker’s vehicles last year caused the company’s plans to enter India to halt. Electric car import taxes in India might reach 100%. The company had undertaken new negotiations with officials in May of this year over government incentives for the production of its automobiles and batteries.

According to Musk’s statement from last month, Indian Prime Minister Narendra Modi was pressuring the automaker to make a “significant investment” there. He had also mentioned that an announcement of this kind was imminent.

Indian officials denied that they were thinking about waiving Tesla’s duties. Tesla automobile import taxes were originally disallowed by the government, but new conversations on incentives have taken place.

India is a rapidly expanding market for automobiles with phenomenal developments happening in various parts of the country. This has made it a lucrative destination for the Auto MNCs to look forward in expanding their business.