Indianise manufacturing, hire Indians for top posts: Government to Chinese smartphone makers

The Indian government has asked Chinese smartphone makers to induct Indian equity partners in their local operations, The Economic Times reported on Tuesday, citing sources.

In addition, the report added that Indians need to be in the top executive positions in Chinese smartphone companies operating in India.

Positions like the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, and Chief Technical Officers need to be occupied by Indian nationals, the media report said.

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The Economic Times added that Chinese handset makers also need to Indianise their manufacturing ecosystem to the component level.

The publication quoted Pankaj Mohindroo, Chairman of India Cellular and Electronics Association, as saying that the government wants to develop Indian skills and companies through the new policy. "For instance, it wants Indian distribution in place of foreign distributors," he added.

According toCounterpoint Research, the share of Chinese smartphone makers in the Indian market stood at75 percent in 2022.

Fighting tax evasion

The report also said that Chinese smartphone makers were urged to comply with Indian laws and not evade taxes. Alleged tax evasion has been a major bone of contention between Chinese smartphone makers and the Indian government.

Last year, India's Department of Revenue Intelligence had issued a notice to mobile company Oppo for misdeclaration of certain goods leading to custom duty evasion of about Rs 2,981 crore.

Three show-cause notices were also issued to Xiaomi, another Chinese mobile company, for duty liability of about Rs 653 crore. The third Chinese company that came under the tax radar was Vivo India, which had received a demand notice for Rs 2,217 crore.