Elon Musk’s company Tesla has decided to set up the production of electric vehicles in another country. The auto giant wants to build its first factory in India.

Building of an assembly plant in Karnataka is under discussion. The negotiations have been going on for six months, according to the source. Tesla plans to create a research and development venture and has already registered an Indian unit.

Tesla has built its first factory outside the United States in China. In the PRC, electric vehicle sales account for about 5 percent of total sales, while in India this segment is less than 1 percent. “Considering the price of Tesla, Musk won’t be able to sell many cars in emerging economies. He will probably bet on a fast-growing group of wealthy people,” said Pedro Pacheco, research director at Gartner Inc.