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Indian Businesses Hit By Visa Delays For Chinese Professionals
To overcome this hurdle, some companies are sending their technical resources to China and Taiwan for training in skills like manufacturing line installation
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Indian businesses are facing negative consequences as a result of the government's stringent visa approval process for Chinese nationals and its strict scrutiny of investment plans from Chinese firms. This situation has led to project delays and even cancellations, according to multiple industry executives interviewed by a media house,
Homegrown electronics contract manufacturers, such as Dixon Technologies, are experiencing the impact, as their expansion projects, including a proposed Rs 400-crore refrigerator manufacturing unit, are being affected by the non-granting or delayed granting of visas to Chinese engineers.
To overcome this hurdle, some companies are sending their technical resources to China and Taiwan for training in skills like manufacturing line installation, as mentioned by executives.
Atul Lall, Managing Director of Dixon Technologies, highlighted the need for government support, particularly regarding visa clearances for Chinese engineers, especially for companies holding production-linked incentives (PLIs). Lall emphasised the importance of Chinese technical expertise for building plants and manufacturing infrastructure, expressing concerns that a lack thereof would hinder India's Make in India ambitions and the scaling up of companies.
In a recent development, the Tata Group's joint venture between Voltas, an air-conditioner manufacturer, and Chinese compressor manufacturer Highly International was called off due to regulatory approval delays. The joint venture aimed to invest around Rs 500 crore in manufacturing inverter AC compressors. Additionally, another significant investment proposal for manufacturing expansion from a leading Chinese electronics company is still awaiting approval.
Several prominent Chinese smartphone brands, including Vivo, Oppo, and Xiaomi, are facing visa approval issues, resulting in the absence of their Indian chief executive officers for several months. The Chinese expat workforce in these companies has reduced to approximately one-third or even one-fourth of the pre-Covid levels.
Executives of affected companies reported the need to regularly follow up on Chinese visa applications, including sending letters and meeting senior government officials. Madhav Seth, President (International Business) of Chinese smartphone maker Realme, acknowledged that the government evaluates each Chinese visa application on a case-by-case basis, with the intention of encouraging Indian companies to acquire the necessary skillsets to operate independently in the country.
However, executives stressed that building such skills in India would take time, and until then, Indian companies require support from Chinese and Taiwanese companies and professionals.
Some individuals pointed out that China has been more liberal in issuing visas to Indian trade and industry, particularly since the decline in Covid-19 cases there, and they urged for reciprocity.
Pankaj Mohindroo, Chairman of India Cellular and Electronics Association, representing mobile phone and electronics manufacturers, stated that delays and restrictions in issuing business and employment visas are major obstacles to expansion and increasing value addition.
He emphasised that to achieve India's ambitious plans for 400 per cent growth in mobile and electronics manufacturing within four years and a 1,200 per cent growth in exports, India needs technology transfers, establishment and expansion of operations, including manufacturing, supported by seamless travel of personnel from all relevant geographies, including China.
Industry executives attributed the increased scrutiny and reluctance to issue visas to Chinese professionals, delays in regulatory clearances for Chinese investments, and heightened scrutiny of Chinese companies in India to the strained geopolitical relationship between the two nations, particularly since the Galwan clash in 2020. In 2020, the government introduced the Press Note 3 norms, which stipulated that companies from countries that share a land border with India (such as China) can invest in India only after receiving government clearances.