ED Rejects Allegations of Coercion by Xiaomi Amid Criticism by Chinese Media

Global Times said that the case against Xiaomi was an example of India's crackdown on Chinese companies.

Image used for representational purposes only. 

(Photo: Xiaomi) 

The Enforcement Directorate (ED) on Monday, 9 May, denied allegations that representatives of tech giant Xiaomi Corp were coerced into issuing statements amid questioning by the central agency regarding alleged illegal remittances made by the company.

"The ED denies allegations made by Xiaomi India that statements of its officials were taken under coercion as untrue and baseless," the ED said in a statement, as per The Indian Express.

The ED's statement came in response to an opinion piece written by China's state-backed newspaper Global Times on 8 May that said that India should end its "regulatory assault" on Chinese companies, and criticised India's actions against Xiaomi, as per a report by Reuters.

The Opinion Piece in Global Times

The tech company had told a court in India on Saturday that its top executives had faced threats and coercive tactics amid questioning by the ED regarding alleged illegal remittances made by them.

In response to the incident, Global Times said in the opinion piece that the uncertainty regarding the tech company's "regulatory predicament should raise a red flag for India".

It further added, "The impression that Chinese and other foreign companies could be intentionally targeted and suppressed isn't something good or favourable for India."

The article also said that what happened to Xiaomi could be seen as "another example of India's crackdown on Chinese companies".

Global Times is a tabloid published by the Chinese Communist Party's People's Daily. However, views expressed by the paper do not necessarily correspond to the official line taken by Beijing.

Case Against Xiaomi

The ED seized assets worth Rs 5551.27 crore from Xiaomi's bank accounts in India on 29 April, alleging that the company sent money aboard illegally under the garb of "royalty" payments.

Meanwhile, a court put the ED's decision on hold until the next hearing on the matter on 12 May. Xiaomi has denied all allegations of wrongdoing, claiming that the royalty payments made by them were not illegal.

New Delhi has also banned more than 300 Chinese apps, including TikTok, since a border dispute between the two countries erupted in May 2020.

Xiaomi is the biggest seller of smartphones in India with a 24 percent market share, and employs around 1,500 people in the country.

(With inputs from Reuters and The Indian Express.)