Tesla Inc.'s plans to invest in India appear to be on hold as communication between the electric carmaker's executives and Indian officials has ceased, Bloomberg reports, citing sources familiar with the situation.

According to these sources, Tesla CEO Elon Musk's team has not followed up with New Delhi officials since Musk postponed a planned visit to India in late April. The government has been informed that Tesla is currently facing capital constraints and is unlikely to commit to new investments in India in the near future.

This development comes as Tesla reports its second consecutive quarterly decline in global deliveries and faces growing competition in China. In April, Musk announced significant staff cuts, and the rollout of Tesla's latest model, the Cybertruck, has been slow. Additionally, the construction of a new plant in Mexico has been delayed.

Musk's cancelled visit to India was initially scheduled to include a meeting with Prime Minister Narendra Modi. The visit was called off due to urgent issues within the company. This cancellation came shortly after India reduced import taxes on electric vehicles from foreign carmakers that pledge to invest at least Rs 4,150 crore and begin local production within three years.

With Tesla's interest waning, the Indian government is now focusing on domestic automakers like Tata Motors Ltd. and Mahindra & Mahindra Ltd. to drive EV production. However, sources noted that Tesla would still be welcome to take advantage of the new import tax policy if Musk decides to re-engage with Indian officials.