There are indications that Xiaomi India is being investigated by the country’s financial crimes agency on suspicion of foreign exchange (FX) infractions. In furtherance of the ongoing investigation, the former head of Xiaomi India, Manu Kumar Jain was allegedly summoned by the financial watchdog.
The investigations relate to whether Xiaomi’s business practices in India conformed with Indian FX regulations. The probe reportedly began in February and Jain is expected to help in the investigation by the Enforcement Directorate. It is unclear whether Jain, who is reportedly in India, came specifically in response to the summons. Manu Kumar Jain is currently a global vice president of Xiaomi with his office domiciled in Dubai.
Sources that are privy to the investigation say the financial crimes watchdog is scrutinizing transactions and the existing business structure between the parent company, Xiaomi in India, and contract manufacturers. It has already collected details from Xiaomi India.
Xiaomi says it is fully compliant with the extant laws governing its business in India. It says it is cooperating with authorities on the investigation. Last December, the offices of Xiaomi were raided on allegations of income tax evasion. The Enforcement Directorate has not put out any official statement relating to the investigation.
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