Xiaomi Raises Concerns Over Component Suppliers’ Reluctance to Set Up Base in India

Xiaomi expresses concerns about reluctance among smartphone component suppliers to establish operations in India due to increased scrutiny of Chinese companies by the government.

  • Xiaomi expresses concerns about reluctance among smartphone component suppliers to establish operations in India due to increased scrutiny of Chinese companies by the government.
  • The Indian government is urged by Xiaomi to offer manufacturing incentives and lower import tariffs for certain smartphone components to encourage local manufacturing.
  • Xiaomi’s letter to the Indian government highlights the need for confidence-building measures to address supplier apprehensions and create a conducive environment for foreign investment in manufacturing.

Xiaomi, the leading smartphone manufacturer in India, has expressed concerns about the hesitation among component suppliers to establish operations in the country. This reluctance stems from heightened scrutiny of Chinese companies by the Indian government, following a border clash between India and China in 2020. Despite Xiaomi’s significant market share in India, reaching 18%, the company faces challenges in sourcing critical components locally due to supplier concerns.

In a letter addressed to the Indian government, Xiaomi’s President in India, Muralikrishnan B., emphasized the need for confidence-building measures to encourage component suppliers to set up manufacturing facilities in India. The letter highlights issues related to compliance, visa regulations, and other unspecified factors contributing to the suppliers’ apprehensions. Xiaomi urged the government to address these concerns and create an environment conducive to foreign investment in manufacturing.