The tense relationship between New Delhi and Beijing:
Since the Galwan Valley clash between the Chinese and Indian militaries in June 2020, India has scrutinized Chinese investments and banned thousands of Chinese apps with security threat reasons.
Government hurdles to GM’s Pune takeover:
GWM’s hopes of getting approval from the Indian Ministry of Home Affairs to take over the General Motors Talegaon plant did not materialize even after renewing the contract six times. After that, the automaker decided to completely abandon the Rs 7,895 Indian crore project.
Indian management to abandon GWM:
Amid increasing scrutiny of Chinese investments and GWM’s repeated efforts yielding no results, GWM’s head of product strategy and planning, Kaushik Ganguly , announced his resignation in March 2022. Earlier in 2021, the director of sales and marketing, Hardeep Brar, left the company and joined Kia Motors.
Amendment of regulations on FDI:
Billions of dollars worth of foreign direct investment proposals into India are pending since the revised FDI regulations to increase the screening of proposals made by common countries border with India. GWM is one of the projects awaiting approval for the past two years.
Disagreement over the sale of complete vehicles in India:
In early 2022, GWM rejected India’s proposal to sell fully assembled units (CBUs) of their Haval H6 crossover. As a complete imported car, the Haval will be priced around Rs 60-65, which won’t lead to too much demand, especially given the vehicle’s Chinese origin. Chinese products do not have a positive image in India anyway and things are only worse for technically complex and higher priced items.
As a result, GWM has now kept an eye on Brazil, where it recently purchased a manufacturing plant and also committed to invest Rs 15,790 crores. This investment will also create thousands of jobs that can be created in India. However, GWM will continue to keep an eye on and research the Indian market, according to the report.