Xiaomi has denied allegations that because of asset limits imposed by the government, it is leaving India and moving operations to Pakistan. The South Asia Index story about Xiaomi’s business expansion into Pakistan was denounced by Xiaomi as “false and unsubstantiated.”
Here is what Xiaomi has said:
Xiaomi responded to the South Asia Index tweet by saying it was absolutely false and unwarranted. 2014 saw MI’s entry into India. They started their Make in India experience less than a year after starting their operations in India. All of their televisions and 99 percent of their phones are made in India. They will do all required to protect their reputation from untrue and defamatory claims.
The FEMA competent authority’s September 29 ruling upholding the ED’s asset seizure order from April 29 was challenged by the Chinese mobile phone firm. On Friday, they submitted a fresh case to the Karnataka high court. As punishment for allegedly breaking FEMA regulations and sending money to three groups outside of India under the premise of royalties, the central investigative agency has ordered asset forfeiture.
A high court in Karnataka made the decision to maintain the ruling while placing a $676 million asset freeze on Xiaomi Corp. According to the Chinese smartphone maker, this action “essentially terminated” its business operations in the huge Indian market.
The Enforcement Directorate is alleged to have blocked Xiaomi’s assets in April as a result of allegations that illegal payments to foreign organisations were made under the cover of royalties.
The producer of mobile devices refuted the accusations and appealed to the Karnataka high court, arguing that the sentence was “severely disproportionate” to the charges. Bank guarantees for the $676 million in frozen assets must be produced first, under the corporation’s directions from the court.
Xiaomi claimed that providing such bank guarantees would be challenging for the company. As they need to continue operating their business, pay employee salaries, and fulfil inventory purchases for Diwali.