Vivo raids: China says India risks scaring off investors

This was announced by the Chinese Embassy in India. in a statement on Thursday that investigations by Indian authorities into Chinese companies disrupt “normal business activity” and undermine “the confidence and willingness of market actors from other countries, including Chinese businesses, to invest and operate in India.”

The criticism came after India’s Enforcement Authority, the country’s main financial investigation agency, raided major Chinese smartphone company Vivo earlier this week over money laundering allegations.

AT Press release on Thursday, the Indian agency said that conducted searches at 48 Vivo locations in the country, and Rs 4.65 billion seized ($60 million) from 119 bank accounts, including term deposits, cash and gold bars.

In a statement The Enforcement Authority accused Vivo of tax fraud and said the firm transferred 624.8 billion rupees ($7.9 billion), mostly to China.

“These money transfers were made in order to uncover the huge losses of Indian listed companies in order to avoid paying taxes in India,” the report said.

“Vivo India employees, including some Chinese citizens, did not cooperate with the search and tried to escape,” the agency added.

Vivo Representative in India on Tuesday said the company was “cooperating with the authorities to provide them with all the information they need.”

Xiaomi also aims

The raids on Vivo’s offices come two months after India confiscated more than $700 million from another major Chinese smartphone maker, Xiaomi. it’s the same accused illegal withdrawal of money from the country.

At the time, Xiaomi India stated that “all of our operations strictly comply with local laws and regulations.”

Chinese phone makers dominate the Indian market, with Xiaomi being the top selling brand, according to data compiled by Counterpoint. Vivo is also in the top five brands.

India has tightened its ties with Chinese companies after border tensions escalated between the world’s most populous countries two years ago. In 2020India has banned more than 200 apps, many of them Chinese, including the hugely popular TikTok video platform.