India has reportedly intensified a crackdown on Chinese smartphone companies operating in the South Asian country, which analysts said is maliciously hyping so-called security threats.
The Indian government has asked Chinese mobile phone makers including Xiaomi, OPPO, Realme and Vivo to bring local equity partners into their local operations and appoint Indian nationals in key roles such as CEO, Indian media outlet The Economic Times reported on Tuesday.
In addition, the Indian government has asked these Chinese firms to appoint Indian contract manufacturers to increase local manufacturing down to the component level through joint ventures with Indian businesses, and expand exports from the country and have local distributors, according to the report.
It said that Indian government officials communicated these issues at a meeting held by the Indian Ministry of Electronics and Information Technology (MeitY).
"The MeitY may have disclosed the information on purpose, as the Indian side has had the idea for a long time, which was known among many Chinese companies in India," an India-based industry insider said.
The insider said this measure is bullying against Chinese companies, as the Indian government wants to acquire Chinese companies in a disguised way.
On Friday, India's financial crime agency issued the so-called show cause notices under India's foreign exchange laws to Xiaomi for alleged illegal remittances of 55.51 billion rupees ($673.2 million), Reuters reported. The funds have been frozen by the agency since 2022.
"By maliciously hyping so-called security threats, India has launched crackdowns on Chinese companies, including spot checks, arbitrary penalties and cancellation of contracts. These moves have violated international rules and will lead to severe damage to India's business environment," says Dai Yonghong, director of the Institute of China's Overseas Interests of Shenzhen University.
India's moves reflect arrogance and complacency, according to Dai. The Indian side has overestimated the chance that the US-led economic "decoupling" from China will bring US and EU companies to manufacture in India. It's still a wait-and-see situation, given India's domestic problems including land and labor reforms, outdated infrastructure and sweeping protectionism, he said.
"While the Modi government has stepped up efforts to boost the development of India's manufacturing sector, it still can't achieve its goal in the mobile phone sector over the next decade without Chinese firms," Dai said, noting that Chinese companies have accumulated technologies and management experience for years to get where they're today.
Against the backdrop of a mounting crackdown on Chinese companies, they are particularly cautious about further investment in India.
- Beijing
Anonymous
Singapore was the largest investor in India with USD 17.2 billion investment in FY23, according to latest data from India's Department for Promotion of Industry and Internal Trade.
ReplyDeleteMeanwhile, Singapore had increased its holdings of US Treasurys to USD201.1 billion as at end of April 2023 from USD194.9 billion the previous month, defying the current global trend of de-dollarization.
China's holdings eased to USD868.9 billion from USD869.3 billion during the same period.
Did anyone say the dollar is now the most risky instrument to invest in?
ReplyDeleteDid anyone say India is the most risky place to invest?
To the super talents, the more risky a place or instrument is, the higher the chance of making big money. They must know what they are doing. Betting with OPM is easy and fun. Nothing to lose.
Apple's big time move to India is a total mess. India failed to provide the skilled manpower needed to staff all of Apple's and its downstream supply chain's requirements, with only a fraction of the manpower available to run the factories in India, and therefore unable to provide them and Apple the security to move smoothly forward.
ReplyDeleteRemember that India's population is still largely a service oriented country, with about 70% still engaged in agriculture. How are these people able to work in a high-end electronics environment is a mystery. India is putting the cart before the horse by embarking on big time manufacturing without preparing the ground well before it happened. But India has little choice, because without manufacturing to provide mass job creation for its huge growing population, that is now No.1 in the world. Indians must be really proud of this achievement.
Apple is now in a bind in India. This is made worse by some of the supply chain supporting players moving out, that were forcibly told to follow Apple's big move to India earlier. Ironically these supply chain players are now attempting to return to restart their main production facilities in mainland China, where manpower is not a problem and infrastructures to serve them are all at hand.
Of course there are so much propaganda about Western companies lining up and rushing to move out of China, but please have some salt on hand. No other country is large enough to provide the kind of environment for large scale manufacturing without the kind of skilled workers and supply chains to back it up. Finding out the hard way is truly costly.
Under pressure by Apple's move to India, Wistron Corporation, a Taiwanese company, relocated part of its Iphone assembly facilities from China to India. And so does Foxconn Technology Group of Taiwan. Without the skilled manpower support in India, which arguably is the Achille's Heel of electronics manufacturing, Wistron suffered and eventually and predictably had to relinquish its facilities it set up in India to the Tata Group, the Indian conglomerate. Foxcomm, likewise is in dire straits for the same manpower shortage reasons. Both are now regretting their earlier moves and intends to move back and concentrate on mainland China. They are realising that there is no way they can decouple from China.
Chinese companies could do well to avoid India, as it has already been shown that when they have achieved success after working their guts out, the Indian Government will find ways and means to force them to cede over power to Indian control. That has already happened with Xiaomi, Oppo and others, and not just Chinese companies, but Wistron of Taiwan as well. Just wondering is this the way why Indians are sitting pretty on top as CEOs of multinational conglomerates?
Modi can do all he wants to lure USA companies to invest in India, but it is best for those in Asia, and particularly China, to avoid India, not just in investments, but in bidding for projects in India. The problems will only be known to them after the agreements are signed. Japan found out the hard way with its HSR project in India.
How can the dollar not be risky when it is just toilet paper, without any backing, just backed by hot air.
ReplyDeleteOnce BRICS gets its system in place, that hot air backing the dollar is going to escape. Psst..... Then what is left of countries' investments. A weather balloon?
How much has Singapore lost in India all these years?
ReplyDeleteWhy so-called opposition leader Workers' Party chair Pritam Singh never raise the issue in Parliament? Only know how to beg Sinkies to vote more WP members into Parliament. Do we need so many more WP MPs in order to ask just one question?
Citizens need to know about how the nation's reserves are being managed - got win, got lose ?!
India is never short of skilled workers like US is never short of dollars.
ReplyDeleteIndia can instantly print as many certificates and degrees as needed, to turn the unschooled into schooled and graduates, like the Americans printing fake money.
Some Chinese companies are thinking that they need to be in India to capture the local market to prevent others from doing so. They need not have to worry. No one is going into India in a big way except silly people. China can simply sell the products to India, Made In China, at very competitive prices and would capture the market anyway. No need to spend foolishly investing in manufacturing plants in India and ended losing everything, profits plus investments, all robbed by the Indians and be laughed at for being stupid.
Still refuse to learn the painful lesson and want to pour more good money into India? India is a place where the angels and devils would not dare to tread.
Chinese companies should stop the foolish thinking about the fear of losing the Indian market. No one is going in to capture the Indian market except fools with a lot of OPM to spend and no need to be responsible for the losses.
China should put out from the snake hole and save itself and its money for better use elsewhere. The stupid and stubborn need to be robbed and have only themselves to be blamed. Then there are the more stupid that hired Indians to help to rob them in the name of investing in India.
How could Singapore be losing money in India? If that is so, they cannot be so stupid to put in more and more money into India right.
ReplyDeleteSingapore must be making a lot of money from India until they are too shy to tell. At least this is the thinking, in the long run. They may not make it now, but in the long, long run, they will keep on running. Sure make money one.
India stole USD673.2 million from Xiaomi to pay for six MQ-9 Reaper drones it is buying from the US, part of a thirty-drone deal.
ReplyDeleteTruly true. India has all the skilled workers by just printing certificates and degrees. Companies have found that out the hard way.
ReplyDeleteSo, no arguments that India has all the skilled workers, the same way that USA has all the toilet paper printing rights. Who else can beat that? Maybe even using 3D printing to print Indian skilled workers which can fast-track the issue and solve all the problems, LOL.
Cheap labour and a big market does not always equate to success in attracting investments. There are other aspect of doing business, like really skilled labour, good infrastructure, and now cheap energy as well, figuring in calibrating where to invest. India now has cheap labour, big market and cheap energy from Russia, but lacks the infrastructure and skills needed for companies to take advantage of. As for the consumer market, Indians still lack the spending power to take advantage of the economy of scale generated by such companies.
Don't blame the Indians. Blame the stupid Chinese for throwing their money in India and think it is a good investment. Serve them right. Hope more stupid Chinese will invest in India and lose more money there.
ReplyDeleteIt is not just about losing money. It is about proving how stupid they are. Remember the story of the old woman who saved a snake and took it home, only to be bitten by the snake. And the snake simply said, I am a snake. What do you expect from me?
With Tharman ensconced on the throne as President, Singapore's reserves are safe in a vault with PAP holding all the keys to it. Even if the non-PAP MPs were to scream, bang the table and fling files, demanding answers to their questions about the reserves, they are not going to get them. The reserves will remain the property of the PAP which they can use as they like - pay themselves whatever remuneration they think they deserve, gamble with it, buy votes, fame, etc.
ReplyDeleteA snake would not be your friend. When a snake comes to you and want to be your friend, its intent is to eat you up.
ReplyDeleteThe most difficult thief to guard against, is a member of the family.
ReplyDeleteChina would take a note from sg. Be very friendly with Indian, and get an Indian president. For the times being PM still can be a Chinese. All other ministers can also be Indians. Minister in charge of Muslim preferably be Indian. India would be the number 1 powerful countries in the universe. Dreaming on wetly.
ReplyDeleteSingapore is very happy as long as the PM is Chinese while the rest of the ministers can be Indians.
ReplyDeleteWhy not Indian President for China? If calamity Joe loses his mind after another fall, Kamala Harris will be President of the USA. She is half Indian, but never mind, the Asian Indians will proudly claim her as Indian.
ReplyDeleteSo, Indian UK PM (done deal) Indian USA President (next change), Indian Singapore President (coming soon), why not Indian China President? India powerful or not I ask you?
The possibility of Joe kicking the bucket is definitely there. Last time, Joe kicked a sand bag and survived. American regretted of not putting a bucket instead of a sandbag. They have forgotten English mother taught them what is kicking the bucket means.
DeleteSingapore current President IC said Indian.
ReplyDeleteReally powerful! Without firing a shot, India controls the world. Look out Universe!
ReplyDeleteHonestly I do not know Singapore current President is Malay or Indian? But it matters not. If they claim she is Malay, and follows their argument, having an Indian next no problem right? If they claim she is Indian, having a Malay next also no problem right? A matter of heads and tails.
ReplyDeleteWonder if the question of race is in the picture this time?
Since young, Singaporeans were trained until colour blind and money orientated. To qualify as Presidential candidate; $500 millions is a must, donot matter you are white, black, yellow, mixed colour. Especially, for generations, our boys were trained in green hat, there are no more taboo to chose somebody green like the hulk. Alien also can.
ReplyDelete