Recently, in order to allow its own companies to develop, India has cleaned up overseas companies, conducted strict inspections on some Chinese companies on suspicion of tax evasion, and froze the bank accounts of Chinese companies. On July 11, 2022, Chinese mobile phone manufacturers stated that they had withdrawn from the Indian market due to well-known reasons. At the same time, the multinational companies that were attacked by India included not only Chinese companies, but also British companies, French companies, American companies, etc. Under India's tough measures, many Chinese companies have left India, and more than 2,000 multinational companies have stopped their business in India.
India has always wanted to create Made in India, just like Made in China, but India's facilities are very imperfect and need to rely on technology from other countries to a certain extent. If companies from other countries leave India one after another, it will inevitably hit India's economy severely and affect the formation of India's production chain. According to statistics, in just 6 years, 2,783 multinational companies have closed down their businesses. Relevant personnel in India said that foreign companies are losing interest in India.
India has a very large population and is also one of the countries with very fast economic growth. It stands to reason that multinational companies would like to open factories in India, but most of them have chosen to abandon the Indian market. There are two reasons for this phenomenon. First, it is the reasons of the multinational companies themselves. Second, the business environment in India is not conducive to the development of multinational companies. India's tariffs are very high, which has caused doubts and dissatisfaction in many countries. India has been increasing tariffs since 2018, which has placed a huge burden on many multinational companies.
I don’t know since when, tax disputes with India have become an unavoidable topic, which has also made some multinational companies shy away from India. If you want to run a good business in India, you need to go through cumbersome legal procedures and require a variety of documents. This has also led to the avoidance mentality of many multinational companies and their unwillingness to trouble themselves.