Xiaomi was questioned by the Indian government for illegal fund transfers
According to a Reuters news report, Xiaomi was seized by the Indian government for violating foreign exchange regulations and seized about $725 million in bank funds, arguing that Xiaomi illegally sent foreign currency worth more than 55.5 billion rupees overseas on the grounds of royalties.
Since Xiaomi currently has a market share of up to 24% of mobile phone products in the Indian market, it is also requested by the Indian government to open production lines in the country like Apple and other manufacturers.
This time, it is questioned that Xiaomi sent high funds overseas with misleading information to avoid tax. Therefore, an investigation was launched in December last year, and the seizure of Xiaomi’s bank assets of about $725 million was ordered recently. Xiaomi said in a follow-up response that these funds were used to pay for the licensing of technologies and patents related to the use of products in India. At the same time, it also emphasized that it has cooperated with the Indian government, hoping to solve the misunderstanding as soon as possible, and emphasized that all business activities are based on legal principles.
— Xiaomi India (@XiaomiIndia) April 30, 2022
In addition to the huge market share of mobile phones in the Indian market, Xiaomi currently includes Mijia series IoT products, ecological chain cooperation products, and products including Xiaomi’s service types have also achieved remarkable results in the Indian market. Therefore, in India, a huge economic system has been formed, and the Indian government is currently strictly regulating the development of foreign enterprises and requires support in the real estate industry. Any situation involving a large amount of capital transfer will inevitably be targeted by the Indian government.
