Border disputes and China's ambitions in the Indian Ocean and India's neighboring nations have led government officials to tread carefully.
Although both nations are trying to improve relations, it can take a long time to resolve all the issues and establish confidence. These views were also expressed by Goyal in his recent interview with Bloomberg Television.
BYD’s Indian Manufacturing Plant
Responding to a question on BYD, Piyush Goyal indicated that India has to consider its strategic interests. It means there will be tight scrutiny as far as who might be permitted to invest.
Goyal outrightly said "no" as far as BYD's intentions to increase its presence in India are concerned. This is after the initial rejection in July 2023 when BYD's $1 billion (Rs 8,200 crore) investment proposal was turned down by the Indian government. The investment proposal included the construction of a new factory plant in partnership with Hyderabad-based Megha Engineering & Infrastructures.
Road Ahead for BYD in India
Until things pick up, BYD will most probably stick to the CBU path to sell its all-electric vehicles in India. From the Atto 3, BYD has rolled out fresh models at periodic intervals.
BYD's Indian lineup comprises the Seal sedan, Sealion 7 SUV, and BYD eMAX 7 MPV. With or without the CBU path, BYD has registered a phenomenal year-on-year growth of 90.32%. Sales have surged to 3,401 units in FY25, compared to 1,787 units in FY24.
In March, the automaker reported a YoY growth of 175%. Sales have grown from 144 units during March 2024 to 396 units during March 2025. This has been possible with the launch of newer models and the addition of the dealer network.
In the future, BYD will be looking to add even more new dealerships and look at Tier-II cities as well.
Hurdles for the Chinese Car Makers
Because of geopolitical tensions between the two nations, Chinese automakers have encountered opposition in the form of investment and domestic expansion.
Previously, Great Wall Motor's (GMW) entry into India was put on hold because of regulatory policies that demanded rigorous examination of Chinese investments.
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GMW had planned for a $1 billion investment and was looking to buy General Motors' Talegaon plant in Maharashtra. However, due to border conflicts and policy changes, GMW withdrew from India in 2022. General Motors' plant, meanwhile, was taken over by Hyundai.
China being a non-market economy, India's policy makers were concerned that Chinese governmental influence extended to China-based firms. Lack of openness in Chinese business ownership is another issue.
Issues such as government-backed subsidies and write-off of loans for Chinese enterprises may invite unfair competition in international markets like India. These fears have given rise to policy makers in India restricting Chinese investment.
Conclusion
BYD's faltered “Make in India” plans highlight the larger issue of Chinese automakers struggling to make sense of India's geopolitics and regulations. While BYD has achieved impressive success in India via the CBU path, the absence of local manufacturing might constrain its longer-term competitiveness in one of the world's most rapidly expanding EV markets. India's strategic apprehensions, combined with doubts over the Chinese state's control over business activities, remain key stumbling blocks for Chinese foreign direct investments. It is only when trust and transparency are considerably enhanced between the two countries that Chinese firms such as BYD will be able to make further inroads into India.
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