Huawei, Alibaba, Tencent among 7 Chinese firms in India with links to PLA, claims govt
The government has identified at least seven Chinese companies in India with alleged direct or indirect links with People’s Liberation Army (PLA) along with Chinese venture capital investments in India including “big names” where the benefits of civilian innovation are suspected to be used for China’s defense sector.
These include Alibaba, Tencent, Huawei, Xindia Steels Ltd which is considered as one of the largest joint ventures between India and China; Xinxing Cathay International Group which has set up a manufacturing facility in Chhattisgarh with an investment of Rs 1,000 crore; China Electronics Technology Group Corporation and SAIC Motor Corporation Limited.
“We have zeroed in on some companies with links with the Chinese army but what action would be taken is yet to be decided,” said a source in the know of the internal note.
The development comes after New Delhi banned 59 Chinese apps in the country and is prompted by a US-China Economic and Security Review Commission, a congressional commission of the US which said that the Chinese government’s military-civil fusion policy aims to spur innovation and economic growth through an array of policies and other government-supported mechanisms, including venture capital (VC) funds, while leveraging the fruits of civilian innovation for China’s defense sector.
“This raises direct question mark on Chinese VC investments in India including big names like Alibaba and Tencent,” the government said in an internal note.
The US had in June put together a list of 20 companies which it said are owned or controlled by China’s military, opening them up to potential additional Americans Sanctions.
Internal studies of the government in 2018 had said that some Chinese investors have already gained control over certain Indian startups that have invested in by leveraging the co-investing behaviour. E-commerce, online lending and social media & content were the top three market segments in terms of number of companies that received Chinese funding.
SAIC Motor Corporation Limited is the parent company of MG Motors, which sells MG Hector in India. One of the subsidiaries of SAIC is Nanjing Automobile which was previously a vehicle servicing unit of PLA.
