Indian Authorities Raid Vivo, Xiaomi Offices

With its "frequent investigations" of Chinese enterprises, India risks hurting its reputation among foreign investors, Beijing complained to New Delhi this week, Diksha Madok reported for CNN Business.

Photo Insert: The raids on Vivo offices come two months after India seized more than $700 million from another big Chinese smartphone maker — Xiaomi.

In a statement issued Thursday, China's embassy in India said that Indian authorities' investigations into Chinese companies were disrupting "normal business activities" and chilling "the confidence and willingness of market entities from other countries, including Chinese enterprises, to invest and operate in India."

The criticism comes after the country's main financial investigation agency, India's Enforcement Directorate, raided major Chinese smartphone company Vivo earlier this week on suspicion of money laundering.

The Indian agency claimed it searched 48 Vivo stores across the country and seized 4.65 billion rupees ($60 million) from 119 bank accounts, including fixed deposits, cash, and gold bars. The directorate accused Vivo of tax evasion and claimed the company remitted 624.8 billion rupees ($7.9 billion), the majority of which went to China.

"These remittances were made in order to disclose huge losses in Indian incorporated companies to avoid payment of taxes in India," it said.

"The employees of Vivo India, including some Chinese Nationals, did not cooperate with the search proceedings and had tried to abscond," the agency added.

A Vivo spokesperson in India said Tuesday that the company "is cooperating with the authorities to provide them with all required information."

The raids on Vivo offices come two months after India seized more than $700 million from another big Chinese smartphone maker — Xiaomi. It was also accused of moving money out of the country illegally. Xiaomi India said at the time that "all our operations are firmly compliant with local laws and regulations."

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