Indian Enforcement Agency Arrests An Employee Of Chinese Smartphone Maker, Vivo

According to the latest reports, New Delhi’s financial enforcement agency has arrested an employee of Chinese mobile phone maker, Vivo. Reports claim that Indian state agencies have also targeted mobile phone companies Oppo and Xiaomi in the past 18 months. It seems like India is again reigniting fears of a crackdown on Chinese companies operating in the country.

India Arrests Vivo Employee: Here’s Why?

India’s Enforcement Directorate which investigates financial crimes raided vivo properties almost a year ago. They wanted to investigate claims of illegal remittance of funds from India to China, which was equivalent to nearly half the company’s Rs1.2tn (£11.7bn) turnover at that time. Almost after more than a year, the overnight arrest took place.

India and China’s diplomatic relations have been apprehensive since deadly clashes between soldiers along the Himalayan border in 2020. Moreover, a senior legal counsel representing many Chinese companies in India stated that the initial crackdown was planned to pressure the Chinese government following a fatal border clash that resulted in the deaths of 24 soldiers. The trade between both countries has continued. However, India retaliated economically by banning scores of Chinese apps from its market, including video app TikTok.

An Indian government official recently disclosed that the Enforcement Directorate had arrested four people associated with vivo, including a Chinese national. Another report also confirmed that one Chinese national was among those arrested. However, the Enforcement Directorate has not publicly commented on this matter yet. Vivo stated that one of its employees had been arrested, without giving details about their nationality. The company says:

“The recent arrest deeply concerns us. We will exercise all available legal options. The company firmly adheres to its ethical principles and remains dedicated to legal compliance”.

There has been no information about the nature of the charges yet. As mentioned above, Indian state agencies have also targeted Chinese mobile smartphone companies like Oppo and Xiaomi in the past 18 months. The agencies froze almost $700mn of Xiaomi’s assets.

In addition to that, the Directorate of Revenue Intelligence, the tax enforcement agency also accused Vivo of customs evasion last year. The company stated at the time that it was cooperating with authorities. Due to the raids, China’s embassy in New Delhi complained that regular investigations by the Indian side into Chinese enterprises were disrupting business.

According to research firm Canalys, Vivo owned by BBK Electronics, is contending with Samsung for the biggest share of India’s mobile phone market. Vivo has successfully grown its share in recent quarters even though its sales have been lagging. New Delhi police also raided the houses of more than 40 reporters and other staff working at NewsClick. Newclick is actually a news website that Indian officials claim to have Chinese propaganda. Anyhow, let’s see what comes next. Stay tuned for more updates!