Will Alibaba, Huawei, Tencent Be Banned Next By Indian Govt?

The government has reportedly identified seven Chinese companies alleged to be having links with the People’s Liberation Army (PLA) of China. These include big companies such as Alibaba, Tencent and Huawei, among others.

“We have zeroed in on some companies with links with the Chinese army but what action would be taken is yet to be decided,” a source told Economic Times. 

Earlier this month, the US Federal Communications Commission (FCC) formally listed Chinese telecom companies Huawei Technologies Company and ZTE Corporation as “national security threats,” giving further impetus to the persistent anti-China sentiment in the US. 

In a statement posted on Twitter then, FCC Chairman Ajit Pai had made similar allegations against Huawei and ZTE, claiming that the firms had close ties with the Chinese Communist Party and China’s military apparatus. 

Interestingly, Pai’s assessment of Huawei’s close ties with the Chinese military is also shared by Indian intelligence agencies. According to a report in Economic Times, security assessments by India’s Research and Analysis Wing (R&AW) showed how the Chinese telecom firm was closely linked with China’s People’s Liberation Army (PLA) and intelligence agencies. In fact, Huawei was founded by a retired PLA officer Ren Zhengfei. 

Moreover, the government has also identified Chinese venture capital investments in India which are suspected to be working for the benefit of China’s defence sector. These include Xindia Steels Ltd, considered one of the largest joint ventures between India and China, and Xinxing Cathay International Group which has set up a manufacturing facility in Chhattisgarh with an investment of INR 1,000 Cr, among others. 

Any move by the Indian government against Chinese companies such as Huawei will add further impetus to the persistent anti-China sentiment in the country. Last month, India banned 59 Chinese apps, including popular ones such as ByteDance-owned TikTok and Alibaba’s UC Browser, claiming that the applications were engaged in activities prejudicial to the sovereignty and integrity of India. The ban came in the wake of border clashes between the two countries in Ladakh’s Galwan Valley. Since the ban, members of India’s ruling class have urged a boycott of Chinese products and investments in India. Certain decisions of the government give the impression that it’s committed to the proposed boycott of Chinese products and services. 

The Consumer Protection Law (CPA) 2019 which came into effect earlier this week, mandated etailers to mention the ‘country of origin’ for products being retailed on their website. The move is seen as a measure to enable consumers to make informed decisions, and clamp down on the sale of imported goods, especially from China. Earlier this month, the government barred state-run telecom firms from using equipment from Chinese telcos Huawei and ZTE in their mobile network infrastructure.