China says raids into Chinese firms damaging confidence

China's embassy in the south Asian nation has said that multiple investigations by Indian enforcement agencies into Chinese companies are damaging the confidence of foreign entities investing and operating in the country.

Many Chinese firms have struggled to do business in India after political tensions raged after a border clash in 2020. Security concerns have resulted in the banning of more than 300 Chinese apps and tighter rules on Chinese investment.

The embassy's comments came after a financial crime agency raid this week, the Enforcement Directorate, targeted Vivo, owned by China's BBK Electronics, in a money laundering investigation.

Such frequent investigation impedes the improvement of business environment in India and hampers the confidence and willingness of market entities from other countries, including Chinese enterprises, to invest and operate in India, the embassy said.

It added that a number of the 44 production and operation sites of Vivo and related entities across India and China were closely followed by the raids.

Vivo said this week it was cooperating with authorities and was committed to full compliance with Indian laws.

Spokespersons for the Indian agency and government did not respond immediately to requests for comment.

In May, Reuters reported that Xiaomi Corp 1810 was reported. HK, one of India's biggest smartphone sellers, had said in court that its executives were facing threats of violence and coercion during agency questioning about accusations of illegal remittances.

The agency denied the accusations at the time, and Xiaomi denied the wrongdoing.

China's Great Wall Motor was 601633 due to India's tighter scrutiny. SS to shelve plans to invest $1 billion and lay off all employees there this month after New Delhi denied regulatory approval for the purchase of a factory.