BYD proposal faces major setback because of Indian policymakers concern over control of joint ventures

Recently China’s BYD Co. submitted an investment proposal of $ 1 billion to build electric cars and batteries in India in partnership with Hyderabad-based Megha Engineering and Infrastructures. This proposal was submitted to the Indian regulators whose results have not come out fruitful. The Government of India does not look keen on this proposal and is concerned about the control of these joint ventures by foreign partners.

As per the report, heavy control of foreign partners in a joint venture with a local group only allows these local groups to have limited control over technology, decision-making, and other critical know-how. Government has a similar stance on BYD proposals and is not comfortable with the entry of Chinese players into the market due to security reasons.

Something similar led Great Wall Motors to abandon its expansion plan in India. MG Motors is also working hard to get Indian partners on board with a majority stake. Though Chinese firms are looking ahead to enter the Indian market through joint ventures, policymakers to control prefer these ventures only when an Indian partner holds a majority stake.

This halt does not mean BYD won’t be selling in India because it will continue to sell the Atto-3 and e6 in the country. It also supplies batteries to several manufacturers and partners with companies like Oelectra.