The Indian government has rejected a proposal from Chinese car manufacturer BYD to establish a $1 billion manufacturing facility in Hyderabad focusing on the production of SUVs.
BYD had been planning to establish the site with local company Megha Engineering and Infrastructures and submitted a proposal for the factory earlier this month. In the proposal, BYD said the factory would build between 10,000 and 15,000 electric vehicles a year. It is understood that Megha Engineering and Infrastructures was planning to put up the capital for the plant while BYD would provide its know-how and technology.
In addition, BYD and Megha had intended on establishing charging stations throughout the country and also planned to build research and development and training centers.
Read: BYD Sold A Record 1.25 Million PHEVs And EVs In The First Half Of The Year
However, India’s Department of Commerce, Department for Promotion of Industry and Internal Trade (DPIIT) have rejected the plans. A report from Reuters indicates that “security concerns with respect to Chinese investments in India were flagged during the deliberations.”
Local publication Business Today notes that the Indian government changed its foreign direct investment policy in April 2020 meaning that government approval is now needed for investments coming from countries that it shares a land border with.
While BYD will no doubt be disappointed with the decision, it is still thriving with its current focus on Chinese car production and sales. Earlier this month it was revealed that BYD had sold 1,255,637 plug-in hybrid and battery-electric vehicles in the first half of 2023, representing a significant 95.78% increase from the previous year. It had a particularly strong second quarter with sales totaling 700,244, of which 352,162 were battery-electric vehicles while the remaining 348,081 were plug-in hybrids. The Chinese car manufacturer is aiming to sell 3 million new cars this year.
