Xiaomi, which accounts for nearly 20% of the Indian market, makes the latest statement

Jiweiwang News

According to sources, Xiaomi said that smartphone component suppliers are cautious about setting up operations in India due to the Indian government’s strict scrutiny of Chinese companies.

Xiaomi, which holds the largest share (18%) of the Indian smartphone market, also asked India in the letter to consider providing manufacturing incentives and reducing import duties on certain smartphone components.

The Chinese company assembles smartphones in India, using mostly local components and importing the rest from China and elsewhere.

Although Chinese companies operating in India are reluctant to speak publicly about the review, Xiaomi's letter shows that they still have a tough time in India, especially in the smartphone sector, where many key components come from Chinese supplies business.

Xiaomi India President Muralikrishnan B. stated in the letter that India needs to take "confidence-building" measures to encourage component suppliers to do business locally.

Muralikrishnan B. said: "Component suppliers are concerned about setting up operations in India because of the challenges faced by Indian companies, especially Chinese companies."

The letter stated that these concerns are related to compliance and visa issues as well as Other factors were involved, but were not detailed in the letter. "The government should address these concerns and work to instill confidence in foreign component suppliers and encourage them to set up manufacturing plants in India," the report said.

Indian authorities last year accused Chinese smartphone company vivo Communications Technology of violating a number of visa regulations , and accused it of embezzling US$13 billion from India; India also froze more than US$600 million of Xiaomi’s assets for allegedly illegally transferring money to foreign entities by impersonating royalties.

Both Chinese companies deny any wrongdoing.

In the letter, Muralikrishnan B. also made the case for further reduction of import duties in India, following India’s move on January 31 to reduce import duties on battery covers and mobile phone camera lenses.

The letter states that Xiaomi also requires India to reduce import tariffs on sub-components such as batteries, USB cables and mobile phone casings.

Xiaomi said in the letter that lowering import tariffs may "increase the competitiveness of India's manufacturing industry in terms of cost", but that allowing component manufacturers to set up factories in India will require greater incentives.

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