ED on Tuesday conducted searches on the premises of VIVO and the firms related to it. About 44 locations were raided across 22 states. VIVO is allegedly involved in a money-laundering scheme.

The IT department in India, as well as the Ministry of Corporate Affairs (MCA), is also keeping a close eye on the Chinese manufacturing firms. The raid being conducted by the Ed is an extension of the ongoing probe against the Chinese firms. 

China on Wednesday expressed hope that India will comply with regulations as they are investigating Chinese companies. They also hoped that India will give a truly fair, just and unbiased business environment for Chinese organisations that are operating in India.

Local units of VIVO Mobile communications are being investigated for financial irregularities. VIVO came into the radar during the investigations against other Chinese firms. In April, the ED seized Rs 5,551.27 crore of Xiaomi Technology India Private Ltd lying in the bank accounts under the provisions of the Foreign Exchange Management Act (FEMA) in connection with the illegal outward remittances made by the company.

The Ministry of Corporate Affairs is learnt to have a special focus on potential violations including fraud.

In the case of Vivo, an inquiry was sought in April this year to detect if there were "significant irregularities in ownership and financial reporting".

The directors Zhengshen Ou and Zhang Jie of GPICL, a firm related to VIVO also left India last year, their absence is also being questioned as a part of a bigger scheme. 

The Indian government’s crackdown on Chinese firms comes amid border tensions between the two countries. An unresolved dispute along the LAC (Line of Actual Control) in eastern Ladakh has been going on for 2 years.