Indian government are reportedly planning to give green light to MG and Great Wall Motor's proposal for direct investments in country
Great Wall Motor had previously displayed the entire portfolio of their vehicles in India at the 2020 Delhi AutoExpo, marking their public debut in India, but since then the automaker’s market launch had been unconfirmed. But now there finally maybe some progress in this regard. India is currently planning to clear 45 investment proposals from China which will also likely include those from Great Wall Motor and SAIC Motor Corp, as reported by industry and government resources to Reuters.
These proposals have been held up after the Indian government restricted Chinese investment as a retaliatory measure after alleged Chinese troop incursions in the western Himalayan region. While China had blamed Indian troops for the standoff, military tensions between the two nations have eased up at the disputed border now. Around 150 investment proposals from China worth more than $2 billion was stuck due to this dispute. Two government sources who have seen the list have stated that most of the pending 45 proposals are set for approval in the manufacturing sector. As the manufacturing sector is considered as non-sensitive to national security, the proposals most probably will be given the go-ahead. While the sources didn’t elaborate further, industry sources and government officials who know about the process have stated that GWM and SAIC Motors are also most likely on the list as well.
SAIC Motors already have had a presence in the Indian automotive sector since 2019 with its British brand, MG Motors. SAIC has already invested around $400 million out of the $650 million it had committed for India. However, it needs approval from the government for further investment in the country. This means if they get the green light, they will invest more funds to increase their operations in India, and maybe increase their vehicle lineup.
GWM on the other hand doesn’t have a presence currently. The approval means it will be the first investment from the Chinese automaker in the auto market. GWM and General Motors had previously made a joint proposal last year. It was to seek consent for the Chinese automaker to buy the latter manufacturing facility in India, and the deal was reportedly valued at around $250 - $300 million. GMW is planning to invest $1 billion in India over the coming years and has previously stated that establishing operations in India holds a key part in its global strategy. The automaker was planning to start selling its products in India from 2021 itself, but that now stands unconfirmed due to the global situation. A company spokesperson said, "Should we be granted all relevant approvals, we will push all work forward in India, abiding by the laws and rules laid down by the Indian government,".
The change in the Indian government’s stance against Chinese companies has come only after de-escalation of the border dispute as both nations have withdrawn their troops, as reported on Sunday by both countries.