Sanitation: China EV tech drives change under the hood

India File

By Blaine Rodrigues, Editor Online Production, with global Reuters staff

Chinese carmakers remain largely shut out of the Indian auto market, but their electric-vehicle technology is gaining traction as local manufacturers increasingly turn to it to be competitive.

Is this two-way traffic with both countries standing to benefit? And how many road-related puns can I squeeze into one newsletter?

That's the main focus this week (Chinese EV tech, not the puns). Write to me at blaine.rodrigues@thomsonreuters.com with your thoughts.

And scroll down to our 'must-reads' section for an analysis on how El Nino and ethanol are squeezing India's sugar exports.

This week in Asia

Happily EV after?

The new Tata Avinya concept electric vehicle (EV) is presented during India's five-day auto show in New Delhi, India, January 17, 2025. REUTERS/Priyanshu Singh/File photo

Tata Motors' deal to use Chery's EV platform underscores the importance of Chinese technology, which many analysts say is cheaper and faster to deploy. For Tata, Chery's platform is seen as fast-tracking the launch of its premium electric car brand and is expected to make up for lost time as it seeks to maintain the top spot in the domestic EV market.

You can read more on this in Aditi Shah's analysis.

India's automakers are increasingly importing Chinese EV technology while steering clear of deeper equity partnerships due to political sensitivities. Tata and Chery stressed that their deal doesn't involve an equity stake or any transfer of technological know-how.

New Delhi tightened investment rules in 2020 and deadly border clashes increased scrutiny of Chinese companies, effectively freezing China out of the world's third-largest car market. In 2025, Beijing slammed the brakes on the export of its tech know-how in the tariff standoff with the U.S.

There are signs of detente though, with India offering faster approvals for investments involving minority Chinese stakes across a wider range of sectors.

For now, deals like the Tata-Chery one appear to benefit both sides. India gets access to advanced technology and China gains a foothold in the Indian car market.

"If India wants to expand its manufacturing sector and be part of the global supply chain, partnership with China is inevitable," says Santosh Pai, partner at law firm Dentons ⁠Link Legal. "If Chinese companies want to be global leaders, they cannot wish away India and its economic potential."

Impact on major players

China's overcrowded domestic market and the resulting fierce price wars have left car manufacturers struggling to be profitable.

Exports — of cars and technology — are a survival strategy, with China having already raced ahead of Japan as the world's largest vehicle exporter in recent years..

China's EV tech gives it an on-ramp to India, which is sure to have Japanese automakers nervously checking the rearview mirror after they poured billions into making the South Asian nation a manufacturing hub.

If these tech deals rev up, will it put those billions at risk? The Indian car market, particularly for EVs, looks set for an interesting road ahead.

Market matters

An El Nino-weakened monsoon this summer could mean the lowest rainfall in 11 years. And with that in mind, India has drawn up contingency plans for over 300 districts that are vulnerable to water shortages.

The monsoon has so far brought precipitation about 43% below average, and the weather office has forecast weak rains through the week ending July 2. States have been advised to encourage farmers in rain-fed areas to shift to short-duration and less water-intensive crops.

This week's must read

Once the world's second-largest sugar exporter, India is expected to have little surplus for export for at least three more seasons.

The twin pressures of El Nino weather conditions and rising ethanol demand from biofuel policies are poised to keep millions of tons of sugar off the world market. The prolonged absence of Indian exports would remove a key balancing supplier and reshape global sugar trade flows.

Government and industry officials even warn India could soon be forced to import sugar for the first time since 2018.

Read more on that here

In pictures

Auto rickshaws move past an Apple iPhone hoarding on a street in Mumbai, India, June 29, 2026. REUTERS/Francis Mascarenhas

Apple has accused the Competition Commission of India of "copy-pasting" its rivals' claims and failing to properly conduct its own investigation in concluding the U.S. tech giant breached competition laws.

This Reuters exclusive, marks the sharpest escalation yet in Apple's fight with India's antitrust investigators.

Read more

This newsletter was edited by Kevin Buckland in Tokyo.

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