According to officials aware of the development, the investment will be close to $1 billion and proposals have been pitched to the Department for Promotion of Industry and Internal Trade (DPIIT).
“Investment for the project is going to be made by Megha while the technology and knowhow will come from BYD,” one of the persons associated with the plan told ET, adding that equity structure of the joint venture and mechanisms to send back royalty to BYD are being deliberated.
Olectra Greentech, a unit of MEIL has already developed electric buses with technical support from BYD. The company is currently sitting on orders for 2,000 buses worth ₹3,000-3,500 crore, which it plans to deliver in the coming 12-18 months. “We are examining the proposal. Since it is a proposal from a land-border sharing country, it will be carefully examined,” said a government official.
Since April 2020, a nod is required for investments coming into India from its land-border sharing countries. A prior approval is given by a committee headed by the Union Home Secretary. This was made mandatory to prevent Chinese companies from circumventing rules to acquire entities in India following the Covid-19 pandemic. The DPIIT is already scrutinizing Chinese automobile firms having ties with Indian front companies. Sources said that attempts have been made to bypass these restrictions as some of the Chinese auto companies have on boarded proxy Indian partners to act as front for them, without any strategic long-term intention of moving capabilities to India. “Any proposal without a strategic long term plan for production defeats the purpose of making the country a manufacturing hub,” one of the sources said.
