Xiaomi India president Muralikrishnan B
has reportedly sent letter to the Indian government. According to an exclusive report by news agency Reuters, the letter dated February 6 raises a range of issues. At 18%, Xiaomi held the biggest share in India's smartphone market during the December quarter of the year 2023. The letter is said to be Xiaomi's response to a query from India's information technology ministry asking how the government can further develop the country's component manufacturing sector.
India needs to work on "confidence building" measures
In the letter, Xiaomi India president said that India needed to work on "confidence building" measures to encourage component suppliers to setup operations locally.
"There are apprehensions among component suppliers regarding establishing operations in India, stemming from the challenges faced by companies in India, particularly from Chinese origin," Muralikrishnan reportedly said, without naming any companies.
Raises Chinese visa issue
The letter further said that the concerns were related to compliance and visa issues. It said "the government should address these concerns and work to instill confidence among foreign component suppliers, encouraging them to set up manufacturing facilities in India." Quoting sources said many executives of Chinese electronics companies struggle to get visas to enter India, and their companies continue to face slow clearances for investments due to heavy scrutiny by the government.
Need to lower import tariffs
In the letter, Xiaomi's Muralikrishnan also made a case for further lowering India's import tariffs. Xiaomi is asking India to reduce import tariffs on sub-components used in batteries, USB cables and phone covers, according to the letter. Reducing the import tariffs could "increase India's manufacturing competitiveness ... in terms of costs", Xiaomi said in the letter, but getting component manufacturers to set up shop in India would require bigger incentives.
This comes after late last month Indian government reduced import taxes on battery covers and phone camera lenses.
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