After failing to get regulatory permits, China's Great Wall Motor has cancelled plans to invest $1 billion in India and laid off all staff at its facilities there, according to three persons with firsthand knowledge of the case.
The Chinese automaker has planned to enter the Indian market since 2020, but it is now one of the largest casualties of New Delhi's intensified scrutiny of Chinese investments.
A Great Wall statement stated the company "would like to thank all the members of the Indian team for their efforts," adding that it will continue to study the Indian market and explore for opportunities in the future.
Great Wall's India entry strategy was unveiled with much enthusiasm during the country's biennial auto show in January 2020. India was an important market for the Chinese SUV manufacturer's global expansion aspirations, and the business had planned to build its largest production outside of China there.
After Great Motor began hiring in India months later, New Delhi enhanced inspection of investments from nations with which it shares a land border in order to discourage opportunistic takeovers during the COVID-19 pandemic.
The crackdown was stepped up following a border clash between India and China later that year, which halted billions of dollars in financial inflows into the auto and technology sectors, among others.
According to the sources, who declined to be identified, Great Wall lay off approximately a dozen staff at its Indian operation on Friday after failing to gain government approval for foreign direct investment to purchase a former General Motors (GM) plant in the nation.
Earlier on Friday, Great Wall and GM called off the factory arrangement, thus ending a two-year project.
Outside of regular business hours, an Indian government official could not be reached for comment.
According to two sources, the fired employees were working on the company's anticipated India entry in departments such as finance, strategy, and marketing, and they will be given three months' severance pay.
Since last year, Great Wall's patience had been dwindling. It transferred some of its employees and dedicated a chunk of its projected $1 billion India investment to Brazil in August.
According to Reuters, the company's research and development centre in the southern Indian city of Bengaluru is running normally.
(Source:www.reuters.com)
The Chinese automaker has planned to enter the Indian market since 2020, but it is now one of the largest casualties of New Delhi's intensified scrutiny of Chinese investments.
A Great Wall statement stated the company "would like to thank all the members of the Indian team for their efforts," adding that it will continue to study the Indian market and explore for opportunities in the future.
Great Wall's India entry strategy was unveiled with much enthusiasm during the country's biennial auto show in January 2020. India was an important market for the Chinese SUV manufacturer's global expansion aspirations, and the business had planned to build its largest production outside of China there.
After Great Motor began hiring in India months later, New Delhi enhanced inspection of investments from nations with which it shares a land border in order to discourage opportunistic takeovers during the COVID-19 pandemic.
The crackdown was stepped up following a border clash between India and China later that year, which halted billions of dollars in financial inflows into the auto and technology sectors, among others.
According to the sources, who declined to be identified, Great Wall lay off approximately a dozen staff at its Indian operation on Friday after failing to gain government approval for foreign direct investment to purchase a former General Motors (GM) plant in the nation.
Earlier on Friday, Great Wall and GM called off the factory arrangement, thus ending a two-year project.
Outside of regular business hours, an Indian government official could not be reached for comment.
According to two sources, the fired employees were working on the company's anticipated India entry in departments such as finance, strategy, and marketing, and they will be given three months' severance pay.
Since last year, Great Wall's patience had been dwindling. It transferred some of its employees and dedicated a chunk of its projected $1 billion India investment to Brazil in August.
According to Reuters, the company's research and development centre in the southern Indian city of Bengaluru is running normally.
(Source:www.reuters.com)
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