India seizes $725m from China’s Xiaomi over illegal remittances

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India seizes $725m from China’s Xiaomi over illegal remittances
India seizes $725m from China’s Xiaomi over illegal remittances

Authorities has said Saturday that they had seized $725 million from Xiaomi’s local bank accounts after an investigation revealed that the Chinese smartphone giant had illegally sent money abroad in the guise of royalty payments.

The company was investigated by India’s financial crime investigations agency in February, and the money was seized from the firm’s local arm after it was discovered that it had made remittances to three foreign-based entities.

 

The Enforcement Directorate said in a statement that “such huge amounts in the name of royalties were remitted on the instructions of their Chinese parent group entities.”

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An AFP request for comment was not immediately responded to by Xiaomi.

In December, the firm’s India office was raided as part of a separate investigation into alleged income tax evasion.

At the time, other Chinese smartphone manufacturers, including Huawei, had their Indian offices searched.

Since a deadly Himalayan border clash between soldiers from both countries in 2020, relations between New Delhi and Beijing have been at an all-time low.

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Following this, India’s home ministry banned hundreds of Chinese-originated mobile applications, including the popular social media platform Tiktok.

The bans on the apps were justified by the government as a safeguard against threats to India’s sovereignty.

Since the deadly 2020 troop clash, anti-China sentiment has grown in India, prompting calls for consumer boycotts of Chinese goods.

According to media reports, China remains India’s most important economic partner, with more than $125 billion in bilateral trade last year.