BYD’s US$1 billion investment plan reportedly rejected by India on security grounds in blow to global strategy

BYD’s partnership with Megha aims to build a plant in Hyderabad to manufacture electric cars and batteries in the world’s third-largest EV market

India’s visa ban on Chinese tourists prevents BYD from making further lobbying efforts while security concerns with respect to Chinese investments also flagged

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Employees at BYD’s electric car factory in Xi’an, Shaanxi province, China. Photo: EPA-EFE

Published: 9:00pm, 24 Jul 2023Updated: 9:14am, 25 Jul 2023

BYD’s go-global drive has hit a speed bump after its proposal to build a US$1 billion car and battery manufacturing plant with a local partner in India was rejected by the South Asian nation on security grounds, according to a local newspaper report.

The world’s largest electric vehicle (EV) maker had planned to send a team of officials to push ahead with the investment, but India’s visa ban on Chinese tourists prevented BYD from making further lobbying efforts, The Economic Times reported, citing an unidentified person who was briefed on the matter.

BYD’s planned factory in partnership with local company Hyderabad-based Megha Engineering and Infrastructure was vetoed by the Department for Promotion of Industry and Internal Trade, the newspaper added.

Security concerns with respect to Chinese investments in India were flagged during the deliberations, the media report said, quoting an unidentified official as saying. It added that existing rules do not permit such investments. BYD declined to comment.

Members of the press and the general public check out the Atto 3 electric SUV made by Chinese carmaker BYD, at the Fully Charged Live electric vehicle trade show in Farnborough, Britain. Photo: Reuters

Through the partnership with Megha, BYD aims to build a plant in Hyderabad to manufacture electric cars and batteries, taking a substantial step in tapping the world’s third-largest EV market.

A foothold in India is key to BYD’s plan to bolster sales outside mainland China. Over the long run, BYD intends to produce a full range of EVs in India, from low-priced hatchbacks to luxury models.