Saturday, October 8, 2022
HomeBusinessFacing government action, Huawei to dial down R&D operations

Facing government action, Huawei to dial down R&D operations

Decision comes after IT investigations and investigations into ‘national security’ aspects

Decision comes after IT investigations and investigations into ‘national security’ aspects

Facing income tax raids, exclusion from 5G telecom trials in India and increasing restrictions on research collaborations, Chinese telecom giant Huawei plans to downsize its research and development (R&D) facilities here, sources say. The Hindu, which could affect much of the 3,500 jobs the company has created in India over the past two decades. The decision to consider downsizing and even close parts of its R&D campus operations just outside Bengaluru comes more than a year after Huawei claimed it would continue its work in India “come what happens”.

The sources say the reconsideration comes after a series of government actions, including income tax raids and audits of 20 years of corporate data, investigations into “national security” aspects of Huawei’s operations, and a Look Out Circular (LOC) against Li Xiongwei, CEO of Huawei. Huawei Telecommunication India (marketing activities), against which he has appealed in court. On August 12, Mr. Li appealed to the court against the LOC that had prevented him from traveling abroad, submitting the statement through his lawyer, noted telecom expert Vijay Aggarwal: [national] and I am not a terrorist.” The tax authorities have asked the court, whose decision is expected this week, not to allow the Huawei chief to leave, in case he does not return to face charges of tax fraud and non-compliance.

The Hindu contacted Huawei on Sunday for a response, but received no response.

According to multiple sources, Huawei executives find it difficult to pursue R&D activities in particular, as the government, including the Ministry of the Interior, the Ministry of Education and others, has imposed informal restrictions on all collaborations by “critical ecosystem players” such as universities, start-ups and analytics companies. Since the pandemic, the sources said, Huawei’s product and technology experts from China have been unable to obtain visas to visit India as well, ostensibly due to mutual restrictions by the Chinese government.

As a result, Huawei has already moved some of its critical development projects back to China and redeployed Indian teams to existing projects. “It’s almost the endgame for Huawei in India,” said a leading telecom analyst in Gurgaon, adding that “without 5G [exclusion from Indian 5G trials], the company is out of the telecom market to maintain 2G, 3G and 4G networks as it is not on the Indian government’s list of trusted partners.” In addition, while existing projects are being delivered, no new projects are currently being contracted.

The case against Huawei is part of a series of government measures to check the influence of Chinese companies in the country, especially after tensions between New Delhi and Beijing over People’s Liberation Army (PLA) violations at the Line of Actual Control in Ladakh in April 2020 Besides Huawei, telecom majors ZTE, Vivo, Xiaomi, Oppo and other Chinese companies have had their offices searched in recent months by teams from the Income Tax Department and the Directorate of Revenue Intelligence. Speaking to journalists in Delhi last week, Chinese Ambassador Sun Weidong warned that the actions could “damage Chinese interests”, pointing out that investment in India and the “Make in India” program could be detrimental unless India “open, fair and non-discriminatory” business environment.

“We have noted that the Indian side has recently taken a series of actions against some Chinese companies in India. Harming other people’s interests will not benefit anyone,” said Mr. Sun.

“The Chinese enterprises have created a lot of local employment and contributed to the economic and social development of India. The Chinese government always requires Chinese companies to operate abroad in accordance with the laws and regulations, and also strongly supports Chinese companies in protecting their legitimate rights and interests,” he added.

The Ministry of Foreign Affairs (MEA) declined to comment on the matter or on the ambassador’s comments.

A senior government official said: The Hindu that tensions with China had led Indian agencies to scrutinize Huawei and other Chinese companies backed by Beijing.

“Apart from major tax-related crimes, significant and damaging evidence was found regarding its role in advancing the goals and objectives of the Chinese state that are detrimental to national security,” the official said. to be identified. However, no charges other than those related to IT have been filed.

In 2000, Huawei invested more than $150 million to set up an R&D facility on 20 acres of land on the outskirts of Bengaluru. While it initially had plans to increase its workforce to over 10,000, it currently employs 3,500 engineers working on various products and development activities. “Huawei pays well and takes good care of its employees. That’s why the company enjoys a good retention rate even in this day and age,” said BS Murthy, CEO of Leadership Capital, who previously hired for the company. With plans to put software engineers and product design teams in the offing, and another possible plan to rent out portions of the sprawling campus, the future of those jobs appears to be at stake.

See also  इस महीने लॉन्च होगी टाटा की सबसे सस्ती इलेक्ट्रिक कार, सिंगल चार्ज में 250 km रेंज - Tata Tiagos EV model to be launched by Sept end can cover 250 kms in a charge Tutd
RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular

Recent Comments