Unlock Editorial Digest for Free
FT editor Roula Khalaf chooses her favorite stories in this weekly newsletter.
New Delhi’s financial enforcement agency has arrested an employee of Chinese mobile phone company Vivo, rekindling fears of another crackdown on Chinese companies operating in India.
The overnight arrest comes more than a year after India’s Enforcement Directorate, which investigates financial crimes, raided Vivo’s properties arrive Investigating allegations of illegal transfers of money from India to China, the board said the amount was equivalent to nearly half of the company’s 1.2 trillion rupees (£11.7bn) turnover.
Diplomatic relations between India and China have been strained since deadly clashes between soldiers on the Himalayan border in 2020, and although trade has continued, India has retaliated economically by banning dozens of Chinese apps from its market, including video apps TikTok.
An Indian government official said that the Enforcement Directorate arrested four people related to vivo, including a Chinese citizen. Another person familiar with the matter said that among those arrested was a Chinese citizen. The Enforcement Directorate has not commented publicly.
Vivo said one of its employees had been arrested but did not elaborate on his nationality. “We are deeply concerned by the recent arrests,” it said in a statement to the Financial Times. “We will exercise all available legal options.” Vivo added that it “firmly adheres to its ethical principles and remains committed to complying with the law”.
Information on the nature of the charges has not been made public.
Indian state agencies have also targeted Chinese mobile phone companies Oppo and Xiaomi in the past 18 months. They froze nearly $700 million of Xiaomi’s assets. Tax Enforcement Agency Tax Information Service, was charged last year Tax evasion in vivo. Vivo said at the time it was cooperating with authorities.
The raid led the Chinese embassy in New Delhi to complain that “India’s frequent investigations into Chinese companies” were disrupting operations.
Vivo, owned by BBK Electronics, is vying with Samsung for the largest share of the Indian mobile phone market, according to research firm Canalys. Despite sluggish sales, Vivo has been growing its market share in recent quarters.
Earlier this month, New Delhi police raided the homes of more than 40 journalists and other staff members of NewsClick, a news website that Indian officials said spread Chinese propaganda.
Svlook
