BYD’s $1 Billion Indian Investment Proposal Rejected: Here's What Happened

The Chinese EV maker was planning to join hands with a private Hyderabad-based company to set up an EV manufacturing plant in India

Shortly after Chinese EV maker Build Your Dreams (BYD) put forward a proposition of investing a billion dollars in our market, the Indian government has now denied it. The only publicly known reason behind this decision included a concerned official stating “security concerns with respect to Chinese investments in India were flagged during the deliberations," as reported by The Economic Times.

Details About The Planned Deal

In mid-July 2023, BYD had plans to partner with a private Hyderabad-based company called “Megha Engineering and Infrastructures Ltd” to form a joint venture to build electric cars and batteries in India. Together, the two companies had submitted an application to the Department for Promotion of Industry and Internal Trade (DPIIT) proposing to set up the said EV plant in Hyderabad itself.

In the proposal, the two companies had mentioned that they plan to produce 10,000 to 15,000 electric cars per annum. While capital requirements were to be met by Megha Engineering and Infrastructures Ltd, BYD was set to be responsible for the know-how and technology.

Also Read: This Electric Hatchback From BYD Could Make MG Comet EV Sweat

What Lead To The Rejection?

We recently saw MG Motor India, another subsidiary of a Chinese company, working out ways to dilute ownership to Indians over the next few years. But what’s making Chinese-based companies or subsidiaries take such steps? It all boils down to the ongoing tensions between India and China, which has hampered the flow of foreign direct investment (FDI) and even led to troubles for carmakers planning on raising funds from investors based in the latter.

BYD’s Run In India So Far

For now, the Chinese EV maker has only two models in its passenger vehicles range, namely the E6 MPV and the Atto 3 electric SUV. It had also showcased its next EV for India at Auto Expo 2023 in the form of the Seal EV sedan. However, BYD has been in India for a long time, providing material handling equipment, public sector transport, heavy-duty trucks, and so on in different fields.