Chinese electric vehicle giant BYD and its Hyderabad-based partner Megha Engineering and Infrastructures previously announced plans to invest $1 billion in India for a new four-wheeler production plant. However, the government reportedly rejected the proposal, per The Economic Times.
This rejection is undoubtedly a significant setback for the company’s goal of expanding its EV production to India. For context, it aimed to hit an annual production capacity of 10,000 to 15,000 units in the domestic industry.
BYD’s presence in India
The Chinese automaker had already brought two of its electric vehicles into the Indian market, including the BYD Atto 3 and E6.
In addition, the affordable BYD Seal is also set to arrive in the country in late 2023, as BYD has already displayed it on its official Indian website. Last February, it also exhibited the electric model at the famous Auto Expo 2023.
As EV-a2z recently reported, BYD applied for a $1 billion investment in a new factory for EVs and batteries in partnership with a local firm. The Chinese automaker aims to expand its reach globally, including the blossoming Indian EV market. However, its proposal has been rejected due to geopolitical issues.
Rejection
India’s Department of Commerce and Department for Promotion of Industry and Internal Trade (DPIIT) gathered other government departments’ opinions regarding the proposal and substantially considered these.
Moreover, one government official also stated that “security concerns with respect to Chinese investments in India were flagged during the deliberations.” Apparently, current laws in the country do not accept such a huge investment from Chinese firms.
In fact, India also turned down an investment proposal from Great Wall Motor that aims to build a $1 billion factory in Maharashtra. The Chinese automaker failed to secure government approvals after two and a half years of expectation. In effect, it canceled its Indian expansion plan in July last year.
See Also:
- BYD battery manufacturing expansion: $1 billion plant in India, Sodium-ion batteries in China
- India website lists 700km range BYD Seal EV: Release date and specs
- Chinese BYD is optimistic about India’s electric vehicle market
- China’s BYD enters the passenger car market in India as part of a global push
- Indian EV market advances with 700,000+ units sold in H1 2023
The Indian government’s decision to reject BYD’s investment proposal is unsurprising given the military conflict between the two countries across the 2000+ miles border dividing them. China has been trying to dominate the South China Sea by building artificial islands for fortified military bases.
