Beijing 'Concerned' by India's Income Tax Raids on Chinese Mobile Firms

The Chinese mobile firms which have been swooped on by India's tax authorities comprise more than 40 percent of the Indian market. Despite calls to “boycott” Chinese goods in the wake of the Ladakh border stand-off, sales of Chinese mobiles in India remain largely unaffected and Xiaomi has continued as India’s most popular mobile company.

The Chinese Embassy in New Delhi has said it is “concerned” about raids by Indian tax inspectors on the offices of Chinese mobile firms Xiaomi, OPPO and OnePlus this week, a spokesman said late on Thursday evening.

Responding to a media query about the reported tax raids, the embassy spokesman also said that the Chinese government “has always required Chinese companies to operate in compliance with laws and regulations overseas”.

The spokesman added that Beijing was also bound to safeguard the “legitimate rights and interests of Chinese enterprises and citizens” in other countries.

The Chinese official further asked the Indian authorities to ensure an “open, fair and a non-discriminatory business environment” for Chinese enterprises working in the South Asian nation.

The remarks from Beijing come two days after officials from India’s Income Tax (IT) Department reportedly carried out raids on the offices of Chinese companies at nearly 24 locations across the country.

The Indian tax inspectors have alleged that the Chinese firms in question were producing “illicit purchase bills” to reduce their overall tax liabilities, according to a report.

The tax office raids were reportedly carried out in Delhi, Mumbai, Kolkata, Bengaluru, Gurugram and Greater Noida among other places.

Xiaomi and Oppo have denied any wrongdoing, and have released separate statements pledging to adhere to the “law of the land”.

“We will continue to fully cooperate with authorities concerned as per procedure,” Oppo said in a statement on 22 December.

The tax office raids against Chinese companies come amid a lingering military border standoff between the two Asian giants in the eastern Ladakh region.

The standoff began in May last year and remains unresolved in spite of both sides carrying out 13 rounds of military commander-level talks and several rounds of official meetings, including face-to-face meetings between the two foreign ministers.

Although India has warned China that the standoff will affect the overall bilateral relations and will spill over into other matters, Beijing has consistently urged New Delhi to place the border dispute at an appropriate level in the overall ties.