NEW DELHI: Xiaomi will be taking legal action against websites selling its phones illegally and infringing on the company's trademark in India where the Chinese handset maker has an ongoing patent dispute with Ericsson.The Swedish telecom equipment maker had alleged earlier this month that Xiaomi was selling Mediatek-powered smartphones through Xiaomishop.com, in violation of an interim order of the Delhi High Court that allowed the company to only sell Qualcomm chipset smartphones. The largest smartphone maker in China had told the court that the website was not an authorised seller for Xiaomi products.“They’re infringing on trademarks and they’re making the world believe that it’s a genuine Xiaomi site, which it is not,” said Manu Jain, head of India operations at Xiaomi. “The products sold on these websites are not meant for India and are sold at significantly higher price points. We have written to them multiple times, and we will be taking legal action against them,” he added.Jain said that though Xiaomishop.com site was not functional any more, the company will still proceed with legal action against it and four to five other sites, which were selling Xiaomi products illegally. Flipkart and Airtel are authorised Xiaomi sellers in India.In more steps to conform to Indian laws and assuage lingering concerns, Xiaomi is in talks with manufacturing partners Foxconn and Inventec to set up a manufacturing base in India, its second most important market after China, apart from moving its data servers to the country by end of 2015.“We’re holding conversations with FoxConn and Inventec, who majorly manufacture for us, to set up an assembly line in India,” Jain said. The location for setting up manufacturing is still to be decided depending on the ecosystem required by the manufacturers, who will be handling the entire process.Xiaomi is looking to set up Mi.com, a full-fledged e-commerce site, which will sell all of the company's products including TVs, routers and Xiaomi goodies. To take this forward, Xiaomi is exploring options including a model where Mi.com can be franchised out.“We’re the third largest e-commerce company in China. We’re definitely going to launch Mi.com in 2015, which will work in parallel with Flipkart.com. We’re exploring different options, one of them being marketplace,” Jain said.Mi.com could also work on a model where Xiaomi would handle the back-end while an Indian partner handles front-end sales, an arrangement similar to Bharti-Walmart albeit online, a person familiar with the company’s thinking said. However, Xiaomi will have to comply with Indian laws on foreign direct investment.Having garnered a market share of 3-4% as of December after selling over 1 million smartphones since July 22 last year, Xiaomi is now focusing on setting up its own research and development centre in Bengaluru where, within a year, smartphones’ software will be designed and be meant for the Indian market.The company is also ramping up production in China, which will allow it to increase the number of units from about 100,000 units it sells a week through flash sales on Flipkart, to about five times that number. Jain added that high production may also permit Xiaomi to offer its devices through ordinary sales online in the future. Xiaomi is set to launch the Red Mi Note 2 within a couple of months.While it is a new operating system, MIUI 6 will be rolled out to all handsets in India by March. It will also offer Tamil and Telugu languages along with the update. Besides launching localised themes, Xiaomi will add eight other Indian language options in the coming months.