Despite several roadblocks, particularly after the 2020 geopolitical tensions and increased scrutiny, Chinese firms are persistently making efforts to re-enter, stay afloat and expand in the Indian market
Chinese electronics and automobile companies' expansion plans in India are facing setback due to delayed government approval for their parent firms’ equity funding proposals. The Chinese companies, including Haier and Xiaomi, are eyeing to use cash reserves or borrowing options like loans to finance their expansion plans, according to the Economic Times.
Despite several roadblocks, particularly after the 2020 geopolitical tensions and increased scrutiny, Chinese firms are persistently making efforts to re-enter, stay afloat and expand in the Indian market.
Chinese electronics giants like Lenovo and Xiaomi have marked an increase in working capital backed by cash reserves and borrowings. Firms like Haier and Midea Group are reportedly using a combination of cash reserves and loans like external commercial borrowings (ECBs).
Before Chinese automaker MG Motor’s joint venture with Sajjan Jindal-owned JSW Group in 2024, the automaker had resorted to the ECB route.
The Indian government is allowing Chinese companies presence in India to support ‘Make in India’ initiative. Under this the government has proposed a partnership of Chinese companies with Indian firms.
After nearly four and a half years of ban, the fast-fashion brand Shein is going to make a comeback with the help of billionaire Mukesh Ambani’s Reliance Retail. According to a recent ET report, the Chinese retail fashion brand Shein will re-enter India with the support of Reliance Retail’s Ajio platform. The move was also confirmed by the commerce and industry minister, Piyush Goyal, via a written reply to the Lok Sabha. The minister said the fast fashion brand’s operations will be carried out on an Indian retail platform.
Other companies especially, smartphone manufacturers Vivo, Oppo and Xiaomi are also collaborating with Indian firms to stay afloat in the Indian market. Earlier, ET reported that Vivo has partnered with Indian smartphone manufacturing firm Dixon Technologies to build a new venture in India. Moreover, the Chinese smartphone manufacturer is also set to establish its largest plant in Greater Noida, infusing an investment worth Rs 3,000 crore and a production capacity of 120 million devices.