Officials on Saturday said India had seized $ 725 million from Chinese banking giant Xiaomi’s local bank accounts for allegedly sending money abroad in pursuit of royalty payments.
The Financial Crimes Investigation Agency of India, which launched its probe in February, said the money was seized after it was found that Xiaomi’s Indian branch had transferred funds to three foreign-based companies.
“Enormous sums were paid in the name of royalties at the request of Chinese parent companies,” the agency said in a statement.
Xiaomi’s Indian branch denied the allegations late Saturday, assuring that the operation was “strictly in accordance with local laws and regulations.”
“We are committed to working with government officials to clarify any misunderstandings,” Xiaomi India tweeted.
The company’s India office was attacked in December as part of a special investigation into allegations of tax evasion.
Other Chinese smartphone makers, including Huawei, also attacked their Indian offices during this time.
Relations between New Delhi and Beijing have been at an all-time low since 2020, when deadly clashes broke out between the two countries’ troops on the Himalayan border.
In the process, the Indian Ministry of Home Affairs banned hundreds of Chinese mobile applications, including the popular platform TikTac.
The government justified banning these applications on the grounds that they were necessary to protect the sovereignty of the country.
Anti-China sentiment in India has increased since 2020, calling for a boycott of Chinese products.
However, China remains a key economic partner for India, with over $ 125 billion in bilateral trade last year, according to local media.