China says India’s frequent investigations of Chinese firms hurt business confidence

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‘Frequent’ investigations by local subsidiaries of Chinese firms by Indian authorities are ‘obstructing the improvement of the business environment’ in India and ‘undermining the trust and willingness’ of other foreign companies to invest and operate in the South Asian market, the Chinese embassy in India said in a statement following raids on Vivo’s offices in the beginning of this week.

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“The frequent investigations by the Indian side of Chinese enterprises not only disrupt the normal business activities of enterprises and damage the business reputation of enterprises, but also impede the improvement of the business environment in India and undermine the confidence and willingness of market players from other countries. including Chinese enterprises that will invest and operate in India,” said Wang Xiaojian, a spokesman for the Chinese Embassy in India, an adviser. stated in a written statement.

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Law Enforcement Agency, India’s Anti-Money Laundering Agency, earlier this week conducted searches in dozens of offices of phone manufacturer Vivo in different states.. In a statement to TechCrunch, Vivo said it was cooperating with the Indian authorities.

The incident follows a similar investigation into Xiaomi, India’s largest smartphone maker. ED seized $725 million from Xiaomi India, accusing the company of violating the currency laws of the country. Xiaomi executives, who denied the allegations and legally appealed the decision, faced “physical violencethreats during their investigation, Reuters reported earlier.

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The Indian Cellular and Electronics Association, a lobbying group representing several tech giants including Apple and Amazon, urged New Delhi to intervene in May and said ED does not understand how royalty payments work in the tech industry. (The Enforcement Authority of India previously said that Xiaomi transferred $725 million to three foreign entities “under the guise of royalties.”)

Xiaojian said late Wednesday that the world’s largest population always asks Chinese firms to abide by laws and regulations abroad and “wishes” the Indian side to provide Chinese firms with a “fair, fair and non-discriminatory business environment.”

“The essence of Sino-Indian trade and economic cooperation lies in mutual benefit and mutually beneficial results. The volume of bilateral trade between China and India in 2021 reached a historical record of more than 100 billion US dollars, which reflects the huge potential and broad prospects for trade and economic cooperation between our countries. China wants the Indian side to investigate and enforce the law in accordance with laws and regulations, and effectively provide an honest, fair and non-discriminatory business environment for Chinese enterprises to invest and operate in India,” he added.

Tensions between the two neighboring nuclear-weapon countries escalated in 2020 after a skirmish on the border. Since then, India has imposed several restrictions on Chinese firms (without ever mentioning China in their orders).

Over the past two years New Delhi banned hundreds of Chinese apps including TikTok, UC Browser and PUBG Mobile, citing national security concerns. India also changed its foreign direct investment policy in 2020 require all neighboring countries with which it shares a common border to seek New Delhi’s approval for its future dealings in the country. Previously, only Pakistan and Bangladesh were subject to this requirement.

The investment rule has significantly limited the ability of Chinese investors to support Indian businesses and startups. Prior to the amendment, Tencent and Alibaba were among the most vocal supporters of Indian startups.


Credit: techcrunch.com /

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