Loots by chinese multinationals
India said yday that it had seized $725 million or over INR 5000 crores from the local bank accounts of China's Xiaomi Corp after a probe found the smartphone maker had made illegal remittances to foreign entities by passing them off as royalty payments.
This is the same model most of the new age companies use whether it is Uber or Airbnb where the local arm earns and pays off a big chunk to parent as royalty payments.
Thats how money flows abroad. In many cases most of the money is earned by local entity and like a large chunk is sent abroad as royalty.
This needs to be looked as a systemic issue and if need be all major companies doing this be investigated more
Simply put a ceiling on royalty payments as a % and also investigate and approve only if any other service is provided by such companies abroad. more
Do you know the investors in Paytm? Chinese. So your privacy is not really safe there. We have to give access to contacts and so many other things when we use Paytm. Cannot even login to Paytm from my desktop,have to scan the QR code on the phone. The app does not work on the phone without giving access to Contacts. Be aware and be careful. more
$725 million seized from the local branch accounts of China's Xiaomi Corp. Remittances to foreign entities are cited as royalty payments. According to ED, such huge amounts in the name of royalty were remitted on instructions of their Chinese parent group entities. Xiaomi was India's leading smartphone seller in 2021, with 24% market share, followed by South Korea's Samsung with 19% share. Chinese companies struggle to do business in India due to political tensions after a border clash in 2020. More than 300 Chinese apps are banned since then, including the popular TikTok. Norms are also tightened for Chinese companies investing in India. Xiaomi is yet to announce any details about its upcoming flagship phone, but past leaks suggest that the company is preparing to launch the Redmi Note 12 Pro series in China soon. They may come pre-installed with Android 12 with MIUI 13 on top. Xiaomi bets big on the 12 Pro. more
Yes, Government must carry out through investigation and bring the culprits to book. more
yes needs to be very careful with especially china companies who are not know for honest operations.Without RBI involvement this cannot be curtailed and initially the whole transfer method should be looked into and made more robust with punishment and fines. more