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Saturday, June 3, 2023

China’s Xiaomi, faces probe for financial Foul Play in India

New Delhi: India has seized more than $ 700 million from one of China’s largest technology companies after accusing it of smuggling money out of the country.

In a statement on Friday, India’s Enforcement Directorate – the country’s largest financial research agency – accused Indian smartphone maker Xiaomi of violating foreign trade rules by “illegally exporting.”

It is not the first time Xiaomi has been in controversy of misappropriating financial accounts. Chinese giant companies have a long list of controversies in tax evasions and exploiting financial systems around the world.

The institute said Xiaomi India, following its parent company’s directives, “had disbursed an amount of [$ 55.5 billion, $ 726 billion] to three international organizations including one Xiaomi-affiliated corporation. . “


Xiaomi started operating in India in 2014 and started sending money the following year, the agency added. Indian authorities have now taken the same amount of money from “corporate bank accounts.”

“Xiaomi India buys fully manufactured mobile sets and other products from Indian manufacturers,” said the Enforcement Directorate. “Xiaomi India has never provided any services to three foreign companies to which such prices have been transferred,” the organization added.
It also accused the company of “providing misleading information to banks while sending money abroad.”
Xiaomi India, a distributor of Mi-branded smartphones, said in a statement that “all our operations are strictly in accordance with local laws and regulations.” In a Twitter letter on Saturday, the company said it believed the royal payments and statements made by the bank “are all legitimate and authentic.”

Payments are made for “licensed technologies and IPs used in our Indian version products.”

India has been experiencing difficulties in Chinese companies since tensions escalated between the world’s most populous countries two years ago. By 2020, India shut down more than 200 applications – most of them Chinese, including the popular video platform TikTok.
Earlier this year, India also shut down several Chinese applications, owned by technology companies such as Tencent (TCEHY), Alibaba (BABA) and NetEase (NTES). In response, Beijing said it was “deeply concerned” about India’s actions against Chinese companies.


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