Govt rejects Chinese BYD-Megha Engineering's $1 billion proposal to set up EV plant
₹8,200 crore). Sources said that the proposal was submitted to the commerce and industry ministry which was circulated for necessary scrutiny and approval from the ministry of heavy industries, the ministry of external affairs and the home ministry. It was discussed and decided not to approve the proposal, they said.
Comments from BYD could not be obtained as an email query remained unanswered. MEIL also did not respond to an e-mail seeking its comments on the development. The proposal was under scrutiny because as per FDI rules, any proposal having investments from countries, which are sharing land border with India, mandatorily requires government permission.
Under Press Note 3, the government has made its prior approval mandatory for foreign investments from countries that share land border with India. These countries are China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan. BYD is currently a technology partner to MEIL's Olektra.
As per industry sources, MG Motor, a British brand owned by China's largest automaker SAIC Motor Corp, has been awaiting government approval to raise funds from its parent. The automaker has been looking to raise capital for some time now to fund its expansion. With little success so far, it has now started looking for other options to raise the required capital.
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