NEW DELHI: China’s automobile giant BYD has reportedly told its India joint venture partner, Hyderabad-based Megha Engineering and Infrastructures, that it would shelve plans for a new USD 1 billion investment to build electric cars after its investment proposal faced scrutiny from Indian government officials.
As per a Reuters report, in the initial review of the proposal submitted by BYD, officials from three Indian ministries, including finance and external affairs, raised what two Indian officials described as security concerns about investment from the Chinese company and signalled opposition.
It was not immediately known whether BYD will have second thoughts, and as of Thursday BYD had not formally withdrawn the investment proposal from government review. BYD, China’s largest EV maker, declined to comment on the development.
If BYD pulls out from its proposed investment, it would be the second Chinese automaker to do so. China’s largest sport utility vehicle (SUV) manufacturer Great Wall Motor Company, which had announced its entry into the market in 2020 with USD 1 billion investment, pulled out after failing to obtain a foreign direct investment (FDI) licence.
Earlier this month, BYD was said to have proposed a USD 1 billion investment in India to establish manufacturing facilities for EVs and batteries. BYD, which competes with Tesla in the global electric car market, already has a presence in India, where it sells Atto 3 electric SUV and e6 electric sedan.
Currently, BYD has a facility in Tamil Nadu. BYD’s raised interest in the Indian market as Tesla is again gearing up to enter the local market. After Prime Minister Narendra Modi’s recent visit to the USA, Tesla officials have resumed talks with the Indian government.