Tesla Inc has proposed setting up a factory in India to build electric cars for domestic sale and export, the carmaker told government officials on Wednesday, according to a source with direct knowledge of the matter.

The company did not discuss lowering import tax on electric cars, the person told.

Senior Tesla executives are in India this week to meet the government to discuss local sourcing of parts and other issues, sources reported on Tuesday.

Nearly a year after postponing its plans to sell vehicles there due to inability to negotiate lower import taxes—which CEO Elon Musk claimed to be among the highest in the world—the electric carmaker has recently expressed a renewed interest in the market.

Local sourcing is in line with Modi's "Make in India" campaign pitch to manufacturers, especially as businesses look to expand their supply chains beyond China.