BYD has told its India partner that it aims to drop its plans for a US $ 1 billion investment to manufacture electric cars, as its investment proposal faced scrutiny from New Delhi, Reuters reported, citing two persons in the know.
BYD and its partner, privately held Megha Engineering and Infrastructures had given a proposal to the Indian government in April to jointly build electric cars in India, Reuters reported earlier this month.
But in the initial review, officials from three Indian ministries, including finance and external affairs, raised what two Indian officials described as security concerns about investment from the Chinese company and signalled opposition, Reuters noted.
BYD executives told Megha Engineering last week that the battery and EV maker wanted to drop pursuit of the investment, according to the two people with knowledge of that exchange, the newswire said.
As of Thursday, the Chinese EV maker BYD had not formally withdrawn the investment proposal from government review, the two officials with knowledge of the review said.
In a statement to Reuters, the company said it has had a presence in India for 16 years, selling both passenger cars and electric-drive buses.
India's finance, external affairs and home ministry did not reply to an email seeking comment. Megha Engineering did not respond to request to comment.
BYD had proposed starting production in India by 2025, the people familiar with the plan said.
India began subjecting investment from China to closer scrutiny in 2020 amid a series of border clashes between the two countries
BYD, the world's largest producer of EVs and plug-in hybrid vehicles, entered the Indian market in 2007 producing batteries and components for mobile phone makers.
In 2013 it started building electric buses in India with Megha Engineering, under a joint venture company called Olectra Greentech (OLEC.NS).
BYD has sold about 1,950 cars in India since starting sales in 2022, according to government registration data.