Multiple Probes Into Chinese Companies Damaging Confidence of Foreign Investors, Chinese Embassy Says

The embassy’s comments come after the ED raided on 44 locations across India in a money-laundering investigation against Vivo and related firms on Tuesday.

By Reuters | Updated: 7 July 2022 13:41 IST

Multiple Probes Into Chinese Companies Damaging Confidence of Foreign Investors, Chinese Embassy Says

Vivo said it was cooperating with authorities and was committed to full compliance with Indian laws

Highlights

Such frequent investigation impedes improvement of business environment
Raids were conducted at 44 production and operation sites of Vivo
Xiaomi has denied wrongdoing

Multiple investigations by Indian enforcement agencies into Chinese companies are damaging the confidence of foreign entities investing and operating in the country, China's embassy in the South Asian nation has said.

Many Chinese firms have struggled to do business in India after political tension surged following a border clash in 2020. India has cited security concerns in banning more than 300 Chinese apps since, and toughened rules on Chinese investment.

Wednesday's comments by the embassy follow raids this week by a financial crime fighting agency, the Enforcement Directorate, targeting smartphone maker Vivo, owned by China's BBK Electronics, in a money laundering investigation.

Vivo India Directors Said to Leave Country as ED Intensifies Probe

Such frequent investigation "impedes the improvement of business environment in India and chills the confidence and willingness of market entities from other countries, including Chinese enterprises to invest and operate in India," the embassy said in a statement.

Raids were conducted at 44 production and operation sites of Vivo and related entities across India, and China was closely following progress, it added.

This week Vivo said it was cooperating with authorities and was committed to full compliance with Indian laws.

Vivo India Probe Should Follow Law and Regulations, Chinese Official Says

Spokespersons for the Indian agency and the government did not immediately respond to requests for comment.

In May, Reuters reported that Xiaomi, one of India's biggest smartphone sellers, had said in court that its executives faced threats of violence and coercion during agency questioning about accusations of illegal remittances.

Xiaomi has denied wrongdoing, and the agency denied the accusations at the time.

India's tighter scrutiny also led China's Great Wall Motor to shelve plans to invest $1 billion (roughly Rs. 7,900 crore) and lay off all employees there this month, after New Delhi denied regulatory approval for purchase of a factory.

© Thomson Reuters 2022

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