Manu Kumar Jain, the global vice president of Chinese electronics giant Xiaomi, announced his resignation on January 30. Jain joined the firm in 2014 and joined its international business in July 2021. He has served as the head of Xiaomi‘s India business for a long time.
The executive listed several things of which he is proud, such as that within three years, Xiaomi became the number one smartphone brand in India, expanding its scale of operations to help generate more than 50,000 domestic jobs. Over the next few months, Jain will take some time off before embarking on his next professional challenge.
According to research by Canalys, in 2022, Xiaomi ranked first in the Indian market in terms of smartphone share, reaching 20%, and its annual shipment reached 29.6 million units.
2022 was a very difficult year for Chinese mobile phone manufacturers in India. Since the fourth quarter, Indian regulatory departments began to take turns searching Chinese mobile phone manufacturers, putting forward several measures such as restricting employee visas, checking taxes, freezing assets and investigating crimes. Xiaomi is one of the key enterprises searched. After being ordered to pay back about $88 million in import taxes in January last year, Xiaomi‘s India division was seized by the Enforcement Directorate in April for improper cash transfers to China.
In addition, vivo and OPPO were investigated by Indian tax authorities in July last year, as they were accused of tax evasion involving billions of yuan. Some manufacturers have contracted as a result. Honor’s CEO George Zhao once said that due to well-known reasons, the company’s India team has withdrawn. However, it still has partners in India and has started related businesses, while the Indian market remains profitable.
According to a report by Jiemian News, there are multiple factors behind India’s restrictions on Chinese mobile phone manufacturers. One source who has been paying close attention to India’s mobile phone industry for a long time summed it up as economic factors, political factors, and industrial upgrading. “India’s business environment has never been friendly to investment from other countries, as exemplified by the successive withdrawal of car companies such as General Motors and Ford Motor from the Indian market. When the Indian government changes its economic policies, local small and medium-sized traders and oligarchs are often protected, while capital from other countries bears the brunt of adjustment. At present, the mobile phone industry is one of the few industries dominated by foreign capital that is still large in India,” said the source.
In 2020, India launched production linked to an incentive program, providing a series of financial incentives to support the development of 14 key industries such as electronic manufacturing. They encouraged domestic enterprises to set up or expand production scale, so as to weaken their dependence on Chinese manufacturing. However, many industry insiders believed that because the core supply chain in India still depends on China, Indian brands obviously lag behind Chinese manufacturers in terms of management experience, technical level and product capability.