- General Motors plans to sell its plant in India to Chinese company
- But this deal is not progressing due to the ongoing conflict between India and China.
- It is necessary to get government approval for China’s investment in India
- Tension between the two countries is not expected to get this approval at present.
The US-based auto giant General Motors is upset by the ongoing India-China stand off between India and China. This is because the company plans to sell its plant in India to Chinese company Great Wall Motor. But the deal between India and China has not been able to overcome the deal, which is increasing the burden on General Motors.
Actually, government approval is necessary for China’s investment in India. The tensions between the two countries are not expected to get this approval recently. According to sources, General Motors plans to shut down the plant from next month. A source said that the plant will be closed by next year or the Great Wall will take over.
Sale off 2017
General Motors was expected to get $ 25–30 million from the deal. The company’s plan was that this amount would be used to compensate for the expenses incurred in covering the business in India. Thus there would be neither profit nor loss for the company. But delay in the deal will increase the company’s expenses. The company will have to pay severance pay.
According to sources, the cost of severance pay may increase as the situation regarding this deal is not clear. Employees are demanding more relief as it will be difficult for them to get a new job due to the coronavirus epidemic. General Motors stopped selling cars in India in 2017. The reason for this was that despite millions of efforts, the company could not increase its sales in India. However, work continued at the plant for export. The company’s plant in Maharashtra employs around 4000 employees.