India on Saturday said it had seized 55.5 billion Indian rupees ($725 million) from local bank accounts of Chinese smartphone maker Xiaomi Corp. for alleged “illegal outwards remittances.”
The Enforcement Directorate said in a tweet, without elaborating, that it had seized Rs55.5 billion from Xiaomi Technology India Private Limited under provisions of India’s foreign exchange laws.
The financial crime-fighting agency summoned a former India head of Xiaomi to investigate whether the company’s business practices conformed with Indian foreign exchange laws, Reuters reported this month.
Meanwhile, Xiaomi told Reuters that all its operations are compliant with Indian laws.
Factory activities pick up amid high inflation
Factory activity in India picked up last month, bolstered by a solid increase in demand as the government eased pandemic restrictions. Still, a private survey revealed that rising energy prices pushed input costs to a five-month high.
International demand also jumped robustly to a 9-month high after contracting in March, and domestic demand was above average.
S&P Global’s Manufacturing Purchasing Managers Index improved to 54.7 in April from 54.0 in March.
It beat the Reuters poll expectation for 53.8 and was above the 50-mark, which separates growth from contraction, for a tenth consecutive month.
“Factories continued to scale up production at an above-trend pace. The ongoing sales and input purchasing increases suggested that growth will be sustained in the near-term,” noted Pollyanna De Lima, economics associate director at S&P Global.
An easing of COVID-19 restrictions underpinned that optimism, but a recent spike in coronavirus cases and an electricity shortage could impair industrial activity in the coming months.
Indeed, the level of business expectations remained subdued compared to past trends. While some firms predicted better growth in the next 12 months, others indicated the outlook was difficult to predict.
ISMC to set up a $3bn plant in Karnataka
International semiconductor consortium ISMC will invest $3 billion in India’s southern Karnataka state to set up a chip-making plant, the state government said on Sunday.
ISMC is a joint venture between Abu Dhabi-based Next Orbit Ventures and Israel’s Tower Semiconductor. US chip giant Intel Corp. has announced plans to acquire Tower.
India’s first semiconductor fabrication unit is expected to generate more than 1,500 direct jobs and 10,000 indirect jobs, the state’s investment promotion division said in a tweet.
ISMC and Indian conglomerate Vedanta Ltd. have applied for Prime Minister Narendra Modi’s $10 billion incentive plan to push companies to set up semiconductor and display operations in India, the government’s next big bet on electronics manufacturing.
(With input from Reuters)
