India — India’s Serious Fraud Investigation Office has recommended a detailed investigation into Xiaomi’s operations in the country, according to a government document reviewed by Reuters.
The proposed probe would assess whether Xiaomi complied with India’s foreign investment regulations, including rules introduced following the border tensions between India and China in 2020.
Among the issues investigators would examine are the ownership of foreign investors and associated entities, the movement of funds and whether the necessary government approvals were secured.
The recommendation still requires approval from India’s Ministry of Corporate Affairs. No specific timetable has been set for a decision, and the process could take months.
Xiaomi said it had not received any notice or communication from the SFIO. The company also said it fully complies with Indian law.
A new investigation would add to Xiaomi’s existing regulatory challenges in India. The company has been unsuccessful in overturning a 55.51 billion rupee, or $584 million, freeze on its Indian bank assets related to allegations of illegal remittances. Xiaomi has denied those allegations.
The smartphone maker is also facing a decline in its position in India’s market. Data from Counterpoint Research cited by Reuters shows Xiaomi’s smartphone market share has fallen to 13%, compared with 19% previously. The company’s India revenue in 2025 stood at $2.52 billion, down 40% from three years earlier.
The SFIO recommendation would also examine Xiaomi’s relationships with e-commerce companies, including exclusive product launches carried out through Amazon and Walmart’s Flipkart.
The proposed investigation covers 21 areas of inquiry. It could include questioning Xiaomi executives and reviewing financial statements, auditor reports and records involving current and former directors and compliance officers.
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