Crack down on OPPO, Vivo, Xiaomi can push them to leave India: Chinese state media

The central government is looking into cases of alleged tax evasion by three Chinese mobile companies, OPPO, Vivo India and Xiaomi.

For Chinese processing and manufacturing enterprises that originally tried to make India an overseas product-processing centre, if it is indeed increasingly difficult and unprofitable to operate in the country, then withdrawing from India is also an available option, state-run Global Times has said.

“Frequent investigations by the Indian side into Chinese enterprises not only disrupt those companies’ normal business activities, but also impedes the improvement of business environment in India and chills the confidence and willingness of market entities, especially Chinese enterprises, to invest and operate in India,” read a commentary in the publication.

As of June 29, India had only approved 80 of the 382 foreign direct investment (FDI) bids that Chinese companies had submitted since April 2020.

“The number presents the increasingly difficult business environment facing Chinese investment and companies doing business in India,” the report said.

Following their withdrawal from India, some manufacturers have moved their attention to nations in Southeast Asia, such as Vietnam.

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“Faced with competition from Vietnam, India should no longer set obstacles for its manufacturing development, and should stop carrying out crackdown on Chinese investment,” the report added.

Despite the Covid-19 pandemic, China-India trade has increased to $67.1 billion in the first half of 2022, putting it on track to surpass $100 billion for the second year in a row.

“Hopefully India can provide a fair and non-discriminatory business environment for Chinese investors, which will be mutually beneficial to both Chinese enterprises and India’s manufacturing ambitions,” the commentary read.

OPPO India, Xiaomi India and Vivo India were served notices by the Directorate of Revenue Intelligence (DRI) for duty evasion, Finance Minister Nirmala Sitharaman announced in the Rajya Sabha this week.

A show-cause notice demanding Rs 4,403.88 crore has been served to OPPO Mobiles India Ltd based on an investigation conducted by the DRI, while five cases of Customs duty evasion have been registered against Xiaomi Technology India, Sitharaman said in a written reply.

The DRI detected customs duty evasion of around Rs 2,217 crore by Vivo Mobile India Private Ltd.

A show-cause notice has been issued to Vivo India demanding customs duty amounting to Rs 2,217 crore, under the provisions of the Customs Act.

Inputs from IANS

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